Ethereum (ETH) has been consolidating between $4,200 and $4,700 after setting an all-time high last August. While many investors anticipate a strong fourth quarter, Citigroup has issued a tempered outlook, projecting ETH to close the year at $4,300.
However, the bank cautions that much of ETH’s recent price action may be fueled by market sentiment rather than fundamentals. The note highlighted, “Current prices are above activity estimates, potentially driven by buying pressure and excitement over use-cases.”
One of the main concerns weighing on Ethereum’s outlook is ETF activity. Citi expects ETH exchange-traded funds to attract weaker inflows compared to Bitcoin, a factor that could dampen bullish momentum. This comes after recent volatility in spot ETH funds, where inflows briefly returned following weeks of heavy outflows.
On the other hand, a bearish scenario projects a sharp drop to $2,200 if macroeconomic conditions deteriorate or equity markets face a downturn.
Meanwhile, digital asset bank Sygnum has painted a more optimistic picture, pointing to Ethereum upgrades, shrinking exchange reserves, and growing institutional interest as catalysts for a potential supply squeeze.
If demand continues to rise under these conditions, ETH could retest its all-time highs faster than expected.
Ethereum is trading near $4,500, about 8% below its record peak. With institutional demand picking up but ETF flows posing uncertainty, the coming months will be crucial in determining whether ETH leans closer to Citi’s conservative $4,300 call or accelerates toward the bullish $6,400 target.
Cover image from ChatGPT, ETHUSD chart from Tradingview
