This Indicator Correctly Called Major Ethereum Moves – Here’s What It’s Flashing Now

• TD Sequential sell signal appeared for Ethereum after predicting 87% rally on April 14, 134% gain on June 16, and 63% correction on August 25, 2025
• US spot Ethereum ETFs recorded four consecutive days of outflows totaling $189.55 million, with May 12 marking the largest single-day withdrawal since March
• Ethereum realized $74.58 million in network profits despite recent correction, signaling that early accumulators from sub-$2,000 February-March levels are taking gains

• $189.55M Cumulative ETF outflows across four consecutive trading days this week
• $74.58M Network realized profits in latest three-week period versus historical baseline
• $1,090 Long-term downside target for Ethereum if correction intensifies from current levels

Ethereum has shed nearly all gains accumulated earlier this month, with technical signals now flashing warning signs for institutional portfolio managers tracking on-chain and chart-based indicators.

Crypto analyst Ali Martinez identified a new weekly TD Sequential sell signal for the second-largest cryptocurrency, a pattern that has demonstrated predictive accuracy across multiple major price moves throughout 2025.

The sell signal arrives as the broader Ethereum market faces renewed selling intensity and capital withdrawal from institutional channels, particularly US-listed spot exchange-traded funds that have become the primary on-ramp for traditional asset managers entering crypto positions.

TD Sequential Predicted Three Major ETH Moves in Less Than a Year

The TD Sequential indicator functions as a price-action tracking system that counts trading bars meeting specific criteria, generating buy or sell signals when thresholds are crossed. For Ethereum, the track record over the past twelve months has been difficult to dismiss: a buy signal on April 14, 2025 preceded an 87% rally, while a second buy signal on June 16 preceded a 134% advance.

Most significantly for current risk management, a sell signal generated on August 25, 2025 accurately timed the onset of a 63% correction, according to Martinez’s analysis.

This batting average, three major signals, three corresponding price moves in the anticipated direction, exceeds what random chance or coincidence would typically produce, particularly across timeframes spanning months. The indicator does not predict specific price targets, but rather inflection points where momentum tends to shift from accumulation to distribution or vice versa.

Institutional quant desks and algorithmic traders running multi-strategy models have historically integrated TD Sequential alongside other technical systems, treating it as one layer in a broader risk assessment rather than a standalone decision-making tool.

The current sell signal raises the question of whether Ethereum is entering a corrective phase comparable to the 63% decline triggered by the August 2025 signal.

Analysts Flag Three Downside Targets Spanning $1,900 to $1,090

If selling pressure accelerates from current levels, Martinez has identified a tiered structure of support zones where Ethereum could find buyers. The first line of defense appears at $1,900, representing short-term support and roughly a 15-20% decline from mid-May trading ranges. Should that level fail to hold, mid-term support sits at $1,565, implying a steeper 30-35% correction.

The most aggressive downside target specified by the analyst is $1,090, described as a long-term support zone positioned near the base of a broader price channel that has governed Ethereum’s range across multiple years.

The $1,090 level carries additional technical weight because it sits near the “strong potential buying zone” identified by Martinez, suggesting that accumulation pressure from longer-term holders might emerge if prices fall that far.

This distinction matters for institutional portfolio construction: a $1,090 floor would represent roughly a 45-50% drawdown from current levels, aligning with historical correction magnitudes in the 2015-2024 period.

Institutional investors typically define risk tolerance in terms of maximum acceptable drawdown; a move to $1,090 would fall within the “catastrophic loss” category for leveraged strategies but within normal volatility bands for strategic allocation models.

Compressed price action near the $2,240 level on four-hour charts has also attracted attention from on-chain analysts, with Santiment reporting high distribution activity in that zone. Price compression, tight trading ranges, often precedes directional breakouts, either confirming the upside thesis or accelerating downside moves once support breaks.

$189.55 Million in ETF Outflows Signal Institutional Rebalancing

Parallel to the technical sell signal, US spot Ethereum ETFs have experienced sustained capital outflows that, while not catastrophic in absolute terms, suggest institutional repositioning away from Ethereum exposure.

Four consecutive days of withdrawals totaled $189.55 million in net redemptions: $17 million on May 11, $130.6 million on May 12, the largest single-day outflow since March, followed by $36.3 million on May 13 and $5.65 million on May 14. For context, May 12’s $130.6 million daily outflow represents material capital rotation for an asset class still developing deep institutional liquidity.

These flows matter because US spot ETFs have emerged as the primary vehicle through which registered investment advisors, pension funds, and other traditional institutional managers gain Ethereum exposure. Unlike over-the-counter trades or direct wallet holdings, ETF flows are visible and quantifiable in real time, making them a leading indicator of institutional conviction.

Consecutive days of outflows suggest not isolated profit-taking by individual fund managers, but rather a synchronized shift in positioning, possibly driven by risk-off sentiment triggered by the TD Sequential sell signal or broader macro conditions.

The timing of these outflows, occurring as the technical sell signal emerged, indicates that some institutional managers may be acting on the same technical framework as Martinez and other analysts.

Realized Profits and Early Accumulators Paint a Contrarian Picture

Against this bearish technical backdrop, an alternative narrative emerges from on-chain data: Ethereum network participants are realizing substantial profits, suggesting that the sell-off may be driven by strategic exits rather than panic liquidation.

Santiment reported that Ethereum recorded its highest network realized profits in three weeks, with traders crystallizing nearly $74.58 million in gains despite the token’s recent correction.

Realized profit totals spike when holders sell at prices higher than their historical acquisition costs, weighted by volume; the magnitude of gains being realized indicates that a meaningful portion of selling pressure originates from positions that entered at significantly lower levels.

The on-chain data reveals the source of these profits: holders who accumulated Ethereum during the February-March period, when ETH traded below $2,000 for extended stretches amid geopolitical uncertainty and broader market weakness.

Those accumulation windows occurred when many market participants were exhibiting risk aversion; the traders who maintained conviction and added to positions during that pessimistic period are now sitting on 50-100%+ unrealized gains. As Ethereum corrected from recent highs, these holders began taking profits, generating the spike in realized gains that Santiment documented.

For institutional investors, this pattern presents a classic contrarian signal: when early accumulators realize maximum profits, markets often find local bottoms shortly thereafter. The sheer size of realized profits, $74.58 million in a single three-week window, indicates that this is not marginal selling by weak hands, but rather substantial capital redeployment by disciplined accumulators.

Historically, when this cohort reaches their profit-taking targets and begins liquidating, supply pressure eases and demand from fresh entrants can reassert itself.

High Distribution Activity and Price Compression Suggest Capitulation Nearing

Santiment also flagged elevated on-chain transaction activity concentrated near the $2,240 level on four-hour timeframes, interpreted as distribution by holders unwinding positions at that price point. This

Original reporting: cryptopotato.com