Ethereum has been consolidating over the last 24 hours after the Federal Reserve’s preferred inflation measure came in below expectations, easing concerns about another interest-rate increase.
ETH rose from a session low of $2,655 to $2,730 following the release, a rebound of approximately 2.8%.
The improvement in sentiment coincided with encouraging onchain indicators and growing attention to Ethereum’s upcoming Glamsterdam upgrade.
However, Ethereum has dropped below $2,700 and is now trading around $2,680 on Thursday.
Ethereum maintains a bullish outlook, but analysts anticipate further consolidation, potentially including a retreat toward $2,500 before a sustained move higher.
Softer PCE data reduces rate-hike expectations
August’s headline Personal Consumption Expenditures price index showed annual inflation of 3.4%, approximately 0.3 percentage points below the consensus cited in the report.
Core PCE also came in below analysts’ expectations, providing another indication that inflation pressure may be easing.
According to the FedWatch figures, the probability of a 25-basis-point increase at the next Federal Reserve meeting fell from 68% to 37%.
That shift makes a hike less likely in market pricing, but it does not rule one out. Subsequent inflation and employment figures could still alter expectations.
For Ethereum, a less restrictive policy outlook could improve appetite for risk assets.
Its initial rebound suggests traders welcomed the report, although a sustained recovery requires buying demand beyond the immediate reaction.
Furthermore, Santiment’s 365-day Market Value to Realized Value indicator moved above zero for the first time since July 2025.
A positive reading suggests the tracked cohort has returned to an average unrealized profit. The analysis interprets that transition as evidence of improving market conditions after an extended weaker period.
It also draws comparisons with previous instances when the indicator crossed above zero, and Ethereum subsequently traded above $4,000.
Those historical examples support the bullish argument, but they do not guarantee a repeat.
The indicator is best viewed alongside price structure, market demand, and the macroeconomic backdrop rather than as confirmation of an inevitable rally.
Santiment data also shows the seven-day moving average of Ethereum trading volume crossing above its 30-day average.
That crossover indicates recent activity has strengthened relative to the longer-term baseline. Higher volume can lend support to a price move, but it includes both buying and selling.
Its significance depends on whether increased activity accompanies sustained gains or renewed distribution.
For buyers, the psychological $3,000 level remains an important hurdle. A convincing move above it would strengthen the case for the next target around $3,400.
The Glamsterdam update is another development that could attract attention, as it is set to roll out in this quarter.
A $2,500 pullback remains a possibility
Despite the positive inflation reaction, Ethereum has been consolidating over the last few hours and could retreat toward $2,500.
The daily chart shows a bullish market, with analysts expecting a rally towards the $3,400 psychological support. However, this could only happen if the bulls continue to defend key support levels.
A failed retest or renewed macroeconomic pressure would weaken that scenario.
For now, Ethereum’s rebound improves the immediate picture, while the path toward $3,400 still depends on stabilization and a sustained break above $3,000.
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