Ethereum price is likely to go down significantly as more and more investors are entering the market
While ETH Open Interest (OI) is up near all-time highs this year, the substantial risk of the Ethereum price dumping as the market faces a significant inflow of users.
Ethereum price likely to dump when the following happens
There is increasing activity by users with ETH across centralized crypto exchanges, according to CEO CryptoQuant, Ki Young Ju. While many are withdrawing their funds, there is still a significant risk of dumping the second largest cryptocurrency after the price spike. That is because too many investors are starting to get involved in the ETH market.
“When the number of new investors and their activity exceeds the average, Ethereum price is likely to rise first and then fall. If too many investors participate in the market, the price is likely to spike and then drop. ETH exchange outflow TX count implies user activeness across exchanges. When the data goes far from the average, the price is likely to dump, forming a blow-off top pattern”, he tweeted.
Source: Ki Young Ju
Earlier, he also warned investors about the Bitcoin Exchange Whale Ratio hitting 90%. CEO CryptoQuant explained that a rise in this metric shows an increase in selling pressure from crypto whales.
Accordingly, Glassnode believes that despite a massive rise of open interest in Ethereum perpetual swaps, many short trades are still open. As AZCoin News reported, Ethereum swaps OI rose to a whopping $8 billion, and this rise is likely to be a confirmation of an upside trend for the second biggest crypto by market cap.
“Ethereum perpetual OI is reaching the higher levels comparable to its ATH for this year. Funding is still tolerable as there is a great deal of shorts. Not everyone is long and strong yet”, Lex Moskovski, Chief Investment Officer at Moskovski Capital, stated.
Ethereum has surpassed Bitcoin in trading volume for the first time on the Coinbase exchange. According to Coinbase, Ethereum handled 26% of all trading volumes in Q2, up from 21%. Bitcoin handled 24%, significantly down from 39% in Q1.
At press time, Ethereum price is changing hands at $3,236 for the first time since late May, up more than 23% in the last 24 hours.
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