Recently, Ethereum’s Open Interest has shown a notable decline, indicating that leveraged positions are decreasing and investors risk appetite is fading. Such sharp drops often signal a cautious phase following periods of high volatility or market uncertainty.
When Open Interest is high, speculative activity tends to increase, leading to sharper price swings. In contrast, the current decline suggests that many futures positions are being closed and excessive leverage is being flushed out, which generally supports more stable and balanced price action in the short term.
Ethereum’s price has formed a solid base around the $3,324 level, which now acts as a strong support zone. As long as this level holds, the price is likely to retest the $3,700 resistance in the coming sessions. The recent drop in Open Interest further supports this potential recovery scenario by signaling a healthier and less crowded derivatives market.
Written by PelinayPA
