Ethereum (ETH) has experienced a significant drop in value, retesting the $3,500 threshold amid a market-wide decrease. CryptoQuant analyst ShayanBTC has warned that the asset could face further declines if current trends in the futures market do not improve. The recent market turbulence has led to multiple altcoins hitting their lowest levels in weeks, with Ethereum slumping to the lower end of the $3,500 threshold for the first time in over three weeks.
Investor anxiety has resurfaced as data from the futures market indicates a bearish sentiment, with market participants expecting steeper declines and continued turbulence. ShayanBTC’s analysis of the Taker Buy Sell Ratio, which measures the aggressiveness of buyers versus sellers in the futures market, reveals a downward trend. The ratio has been dropping, failing to exceed one, indicating that most futures traders are aggressively selling Ethereum.
The decline in the Taker Buy Sell Ratio could be driven by speculation or profit-taking in response to current market conditions. ShayanBTC believes that this decrease serves as a bearish signal, suggesting that Ethereum’s price could continue to trend downward if selling pressure persists. Despite a 131% spike in derivatives volume to a record $24.8 billion, Ethereum’s long/short ratio has plummeted to 0.8921, indicating a dominance of short positions, according to Coinglass data.
Currently, Ethereum is trading at $3,537 after a slight recovery from the $3,503 floor price earlier in the day. Despite a 3.58% drop, the crypto asset remains above the 200-day EMA ($2,945) and 50-day EMA ($3,381). It is essential for investors to monitor the ongoing trends in the futures market and the Taker Buy Sell Ratio to gauge the direction of Ethereum’s price movement in the coming days. The dominance of short positions and bearish sentiment could continue to impact the asset’s value, leading to further declines if the current selling pressure persists.
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