ethereum (ETH) financing prices had taken a beating after the Merge was completed. This event was the single most anticipated upgrade in the history of the network, and it had influenced both price and financing prices in adverse ways. Nonetheless, as the market begins to settle into the new normal of Ethereum (ETH) being a proof of stake network, things are beginning to stabilize. 1 of those is financing prices returning to pre-Merge levels.
Financing Prices Stabilizing
The days leading up to the Ethereum (ETH) Merge had been extremely volatile for the cryptocurrency market Ethereum (ETH) itself had borne the brunt of this, and even though the days leading up to the upgrade were filled with positive movement, it had quickly changed.
Ethereum (ETH) financing prices nosedived on the back of the Merge. It fell from trending just below neutral levels at around negative 0.02 percent to negative 0.35 percent by the time the upgrade was final. It likewise comes after the sell-offs that rocked the market at the same time. In the days leading up to the Merge, FTX longs had seen a total of 9.92 percent paid by shorts to hedge their positions on the exchange.
ETH financing prices recover | Source: Arcane Research
Nonetheless, not long after the Merge was finalized, the market began to see recovery. This recovery was just as sharp as the decline, returning from negative 0.35 percent to around negative 0.02 percent by September 16th. This sharp uptrend was shown in the price of the digital investment, which maintained most of its price through this time. This shows that regardless of the sell-offs, there are still a significant number of Ethereum (ETH) holders who maintain long exposure to the digital asset.
Ethereum (ETH) Might Recover
With financing prices recovering back to pre-Merge levels, it shows that there is still positive trend sentiment between investors. This sustained positive trend sentiment continues to prop up the price of the digital investment even through the bear market.
Since most of the sell-offs happened due to the hype around the Merge, it is only normal that Ethereum (ETH) has begun to stabilize once most of that hype has now worn off. It leaves the accumulators at a point where they are able to buy the digital investment without sacrificing as well much of their previous value.
ETH price falls below $1,300 | Source: ETHUSD on TradingView.com
Even now, with the FOMC-inspired volatility in the market, support for ETH continues to ramp up. Exchange outflows over the last 24 hours show this growing accumulation trend. Outflows were about 40 percent higher than inflows for ETH for the day, as reported by data from Glassnode.
If ETH is able to maintain its level of support at $1,250, this point will serve as a bounce-off point for the digital investment. If ETH successfully breaks through the $1,300 resistance, a retest of the $1,500 level is possible in the upcoming week.
Featured image from Currency.com, charts from Arcane Research and TradingView.com
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