Ethereum (ETH) failed to hold the $1.8K level and dropped to $1,773 before making slight gains. As of this writing, Ethereum was trading around $1,780 after falling 1.26% on the daily chart.
Amidst this volatility in the market, traders on both sides are fighting fiercely to get the market back.
Ethereum: Bears and bulls fight for market control
Like Ethereum Traders noticed that $1.8K failed to sustain the upside momentum as it turned into a stubborn resistance. As a result, high net worth investors used significant amounts of capital to open both short and long positions.
Accordingly lookonchain, One trader opened a 20x short position on 30,000 ETH worth $53.49 million. With ETH showing some strength, the trader has already gained $846.4K in this position.
Historically this trader has a strong winning record, having previously earned over $444k from trading other cryptocurrencies. This short position revealed the whale’s bearish expectations.
The second trader opened a 10x long position on 30,000 ETH worth $53.49 million. The whale has dropped $823.1K so far as ETH continues to decline.
This trader also has a strong winning record and has previously placed eight trades, winning six of them, making a total profit of $3.1 million. The whale’s decision to open a long position showed that they were in an uptrend and were waiting for ETH to recover.
Derivative investors continue their downward trend
Although the two traders above showed interest, overall market participants remained bearish and were selling aggressively at the time of the news.
In particular, the Derivatives Trading Ratio fell below 1. It is currently around 0.946, the level last seen two weeks ago.
When this measure falls below 1, it indicates that more sell-side trades are being executed in the derivatives market. A look at the Futures Netflow metric confirms this view.
For example, $5.94 billion left the Futures position in the last 12 hours. Altcoin’s Futures Net Flow dropped to -$88 million.
Outflows are even more extreme on the 8- and 4-hour time frames, where Netflow fell to -$200 million.
What’s next for ETH?
Although sellers dominate derivatives, Ethereum’s overall directional momentum shows some stability. Thus, capital flowing into both long and short positions increases momentum.
When we look at the ADX with SMA indicator, we see that the positive index is well above the negative index. At the same time, the SMA and ADX are also below the +DI level, indicating that the upward momentum is stronger now.
When this indicator is set this way, it usually signals the possibility of an upward recovery. If the battle between bulls and bears continues, capital flows could help ETH regain $1.8K, which could prepare it for another upward move.
However, if the downtrend continues and the bulls are liquidated, we may see another decline below $1.7K.
Final Summary
- The battle between bulls and bears in Ethereum is heating up: One trader opened a short position worth $53.49 million, while another opened a long position of $53.49 million.
- ETH failed to hold $1.8K and fell to $1,773 but the directional momentum remained stable.
