Ethereum Enters Low-Risk ZoneKey Highlights- Open Interest Drops: The current open interest in Ethereum has fallen by 50% since August, reflecting a reduction in leverage and associated risks in the market.- Reduced Leverage: A decrease in Ether’s RSI, along
- Calmer Market Environment: The drop in open interest combined with reduced pressure on the sell-side has resulted in a more calm market environment, with both sides being cautious.
- Sideways Movement:
The price for Ethereum is moving sideways, ranging between $2,800 and $3,300. Buyers and sellers are waiting for clarification.
Market Analysis- Leverage Reduction
The leverage reduction has brought ease to the market; however, whether it will trigger a strong break on the upside or downside is still questionable.
- Technical Indicators: There is a clear downtrend in the daily charts, with the short-term moving average tending downwards, remaining above the price. The momentum oscillates in a mixed fashion with a slight positive bias.
Outlook- Potential for Larger Move:
Though lower open interest could result in lower volatility, at the same time, it could lead to conditions required for a larger move. - Support and Resistance: For the bullish thesis to be strengthened, there needs to be a close above $3,300-$3,500 on higher volumes and the RSI above 50. Failure of the $2,800-$3,000 level may cause yet another drop.
