What to know:

• Ethereum’s price has dipped 3% to $4,600, despite a strong performance in the preceding month.
• Analysts are cautioning about a potential slowdown in Ethereum’s rally due to increasing profit-taking.
• Recent U.S. inflation data has affected market sentiment, impacting both cryptocurrency and traditional sectors.

Good Morning, Asia. Here’s the latest in market news:

Welcome to Asia Morning Briefing, a daily summary of major stories during U.S. hours and an overview of market movements and analysis. For a comprehensive view of U.S. markets, refer to CoinDesk’s Crypto Daybook Americas.

As Hong Kong commences its trading session, ETH is trading above $4,600, down 3% for the day.

Story Continues Below

As ETH increased nearly 16% in the last week and 45% over the past month, this dip might not concern many traders. The ETH/BTC ratio has broken beyond its 365-day moving average, a historical indicator of extended periods of ETH outperformance, with spot ETF flows reinforcing this trend.

However, this same data also suggests early warning signs of short-term stagnation, as reported by CryptoQuant. Daily ETH inflows to exchanges have outpaced those of Bitcoin, indicating that some holders are preparing to secure profits. ETH’s MVRV ratio against BTC has surged from 0.4 in May to 0.8, nearing historically elevated valuation levels that have previously preceded pauses or retractions in ETH’s strength.

Trading desks share similar perspectives. A recent note from France-based FlowDesk reported that while there were $1 billion in single-day ETH ETF inflows on Monday, alongside broad client buying versus BTC and SOL, there was also a rise in call overwriting in ETH options at the $7K–$8K strikes for December — a sign that some investors are tempering their upside expectations.

Market maker Enflux commented that a hotter-than-expected PPI report has served as a reminder that inflation risks are inconsistent and that Ethereum’s significant performance might invite consolidation.

Despite sound structural drivers like ETF demand, institutional engagement, and favorable on-chain indicators, the market is potentially entering a phase where stretched positions and macro event risks could exert pressure on Ethereum’s momentum. Although the rally seems robust, there are also emerging signs of profit-taking.