Ethereum retreats under $3,700, is the rally over?

After several days in the green, ETH has slipped, raising questions about whether its strong uptrend is losing steam.

According to crypto.news data on July 22, 2025, Ethereum (ETH) has dropped approximately 2.6% in the last 24 hours, trading near $3,692 after retreating from this week’s high of $3,845. The slide, which came alongside a broader minor market pullback, briefly sent ETH down to an intraday low of $3,646 before recording a rebound to its current levels. This quick drop also triggered a wave of liquidations across major exchanges, hitting short-term sentiment.

The pullback follows one of Ethereum’s strongest streaks this year, with the token still up 24% over the past week and 53% over the past month. However, the sudden drop has sparked questions about whether the rally, which has fueled calls for a $5,000 price target, is losing momentum.

On-chain data adds to this cautious outlook. A recent Sentora report reveals that over 90% of ETH addresses are currently in profit, the highest level since December 2024. This raises the risk of profit-taking, particularly as prices consolidate near recent highs.

That said, the bigger picture remains encouraging. Market data suggests this dip is more of a breather than a full reversal. Daily active addresses are down 2.6% to around 526,300, but that’s still 19% higher than last year, according to YCharts. ERC‑20 addresses have cooled 17.6% to about 474,500, signaling a short pause after weeks of heavy trading, but activity remains above 2024 levels.

Surging institutional interest in the asset is another strong pillar. ETH-tracking exchange-traded funds (ETFs) continue to post gains, with about $297 million in inflows recorded on their latest trading day, according to SoSoValue data. A recent CoinShares report also shared a record $2.12 billion in inflows to ETH funds last week, contributing to a total of $6.2 billion in 2025 inflows so far, which already surpasses all of 2024. This year’s total inflows now account for about 23% of the asset’s total AuM, boosted by billions flowing in from corporate treasuries.

If Ethereum can maintain support above $3,500 and capital continues to flow in, the uptrend could quickly regain strength. However, If buying pressure fades, ETH risks retracing toward the mid-$3,000s before attempting another push higher.