Ethereum faces June test after $401.62M ETF outflows

Ethereum closed May down 12.6% after US spot ETH ETFs recorded $401.62 million in net outflows for the month. The outflows in May were the third-largest monthly withdrawal since late 2025, behind November 2025’s $1.42 billion and December 2025’s $616.82 million. The May decline ended a two-year streak of positive May closes for ETH.

ETF flows and monthly price moves have tracked closely so far in 2026. In March, net ETF outflows of about $46.01 million coincided with a 7.07% monthly price gain. April saw $355.98 million in ETF inflows and a 7.38% rise in ETH. May’s larger net outflows coincided with the 12.6% drop.

On-chain data show increased holdings by large addresses and long-term holders during May. Supply held by whale addresses outside exchanges rose from 124.15 million ETH on May 1 to about 125.17 million ETH by late May, an increase that represents roughly $2 billion at prevailing prices. The Hodler Net Position Change metric, which tracks mid- to long-term holder accumulation and distribution, has been positive since Feb. 24 and expanded since mid-May. That contrasts with sharply negative readings in February 2026.

Technical charts on the two-day timeframe display an inverted cup pattern forming since late March, with the peak in mid-April and price returning toward the pattern’s start level. A hidden bullish divergence has developed between price and the Relative Strength Index from March 28 to May 27: price is near a higher low while the RSI printed a lower low. A two-day candle close above $1,964 is the technical threshold cited for confirming that divergence.

Price and cost-basis data set resistance zones for a potential rebound. Ethereum traded near $1,977 at the end of May. A Glassnode cost-basis distribution shows a dense cluster of prior buyers between $2,059 and $2,075 holding about 1.37 million ETH, and a higher cluster between $2,154 and $2,170 holding about 1.24 million ETH. Fibonacci retracements from the late-March low to the mid-April high place the 0.618 level around $2,055 and the 0.5 level near $2,134.

On the downside, a sustained two-day close below $1,964 would align with a measured downside projection of roughly 21% to about $1,545. The 1.0 Fibonacci level at $1,798 is a potential support level on a deeper move lower.

Seasonality adds context for June. Since 2016 the average June return for ETH is about -6.74% with a median of -5.65%, and three Junes in the past decade have closed higher. Market participants will be watching daily ETF flows, on-chain accumulation indicators and whether ETH holds the $1,964 level over the coming sessions to assess near-term price direction.