Ethereum price has fallen 18.5% in the past 30 days and is down about 5.2% this week. On the weekly chart, it is trading at a slightly better level than Bitcoin, but it is far from recovering. One of the key signals on-chain is that most traders have little reason left to book profits.
Under normal circumstances, this will help form the bottom. However, if the profit-taking pressure has already dissipated, an obvious question arises as to why Ethereum price has not yet rebounded.
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Profit-taking incentives decline, but not enough to confirm bottom
Net unrealized gains and losses (NUPL) fell to 0.23, the lowest since July 1. NUPL tracks investor sentiment by measuring the amount of unrealized gains and losses in the market.
Most wallets move between stages like capitulation, where they are carrying losses, and belief or denial, where confidence increases.
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The last time NUPL fell further was on June 22, when it reached 0.17. This move came just before Ethereum rose to 106.3% and helped NUPL rise from capitulation to belief and denial.
Today’s reading is above that level, meaning ETH has room to fall further if the market weakens.
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A lower NUPL output is consistent with conditions that existed before the last major reversal. Currently, the incentive to take profits is minimal, but the downside signals are not yet fully aligned.
Liquidation pressure explains why price does not react to NUPL
The derivatives market provides the clearest reason for Ethereum’s hesitation. In Gate’s ETH-USDT liquidation map, the short exposure is high at $2.36 billion, but the long exposure is still large at $1.05 billion.
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This imbalance continues to put pressure on both sides. The thickest long-term liquidation cluster extends to approximately $3,050. ETH is trading around this level, meaning that even a modest decline could trigger a forced sell by long traders.
Prolonged liquidation can easily cancel out the positive effect of low NUPL. Even if the shorts become overexposed, the remaining long leverage is large enough to keep the market volatile.
This is a relationship between two metrics. Ethereum cannot use a profit bottom setup as long as this long-term liquidation wall remains intact.
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Ethereum price chart lines up in the same risk zone
Ethereum’s price chart also supports the same story. ETH is still trading within a descending channel, with the $3,053 region remaining the most important support. This is precisely the zone where the strongest long-term mobility clusters reside. If the price falls by $3,053, the chances of further decline increase exponentially.
This type of decline is consistent with a possible path for NUPL to slide towards the June low of 0.17, consistent with the setup before the last major leg up.
There is a bullish path forward, but it requires much greater confirmation. ETH needs to regain $3,653 to show real strength, which is still over 14% above current levels. From there, the structure flips from bearish to neutral upon clearing $3,795.
This move also tests the upper boundary of the descending channel, but with only two clean touches and no strong resistance. Once NUPL stabilizes, shorts begin to unwind, and Ethereum price clears these levels, a sharp rebound is possible. Until these conditions converge, ETH will remain trapped between a fading profit motive and a stubborn liquidation overhang.
