Ethereum Traders Contemplate Next Moves as Crypto Slides Below $1,600
As Ethereum’s price falls below $1,600 and revisits support at $1,564, traders are considering their next steps. However, due to the low volatility in the crypto market, it is uncertain whether a knee-jerk reaction will occur.
Investors who were previously eager to buy the dip and anticipate a relief rally have lost interest since June. Many are now choosing to remain on the sidelines until there is an overall improvement in the crypto market, fearing potential capitulation.
Ethereum Open Interest Reaches $5.31B
The open interest in Ethereum derivatives has been steadily increasing in recent days. According to Coinglass, open interest has risen by 4.1% to reach $5 billion. Additionally, trading volume has surged by 332% to reach $10.35 billion. Over the past 24 hours, short positions worth $5.55 million and long positions worth $3.88 million were liquidated.
If this growing interest continues leading up to the expected approval of a futures ETF in October, it could potentially drive up the price of Ethereum to $1,800 and even break the psychological resistance at $2,000.
Ethereum Price Prediction: ETH Expected to Regain $1,600 Support
After bouncing back from fresh liquidity at $1,564, Ethereum has formed two bullish successive candles on the four-hour chart. This rebound has validated a breakout from a short-term falling wedge pattern.
A falling wedge pattern is a reversal pattern that indicates the end of a downtrend and signals that bulls are ready to take control of the market. However, for this pattern to be confirmed, Ethereum’s price must surpass the resistance trendline, which is typically accompanied by a spike in trading volume. Traders are advised to wait for a retest of the resistance trendline to confirm the breakout.
Furthermore, a buy signal from the Moving Average Convergence Divergence (MACD) indicator could further strengthen the presence of buyers in the market. This occurs when the blue MACD line crosses above the red signal line and the momentum indicator slopes upward towards the mean line (0.00) and into the positive region.
Based on Fibonacci levels, if bulls regain the $1,600 resistance, Ethereum’s price is likely to rebound by 61.8% from support at $1,564 to $1,628.
ETH Price Expected to Rebound in October
Currently, there have been few market-moving events apart from the anticipation of spot and futures-based Ethereum exchange-traded funds (ETFs). It has been reported that the Securities and Exchange Commission (SEC) may approve a futures-based ETH ETF in October.
Futures-based Bitcoin ETF products have been available for over two years, allowing investors, especially institutional ones, to gain exposure to crypto without directly purchasing and storing BTC. Following the approval of the first BTC ETF product, Bitcoin’s price rallied by over 60%. This has led investors to have a positive outlook for Ethereum’s price in October.
Hot Take: Ethereum Traders Remain Cautious Amidst Low Volatility
The recent slide in Ethereum’s price below $1,600 has left traders contemplating their next moves. However, due to low volatility in the crypto market and fears of potential capitulation, many investors prefer to stay on the sidelines rather than buying the dip. Open interest in Ethereum derivatives has been growing steadily, indicating increased interest in the crypto. If this trend continues, it could potentially drive up the price of Ethereum. Traders are closely watching for a breakout from a falling wedge pattern and a buy signal from the MACD indicator to confirm bullish momentum. With the anticipation of an ETH futures ETF approval in October, investors have a positive outlook for Ethereum’s price rebound in the coming month.
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