Ethereum Futures Traders Selling Aggressively, How Further Can ETH Price Drop?

Amid the correction in the broader cryptocurrency market, the Ethereum (ETH) price has come under selling pressure dropping 3.5% all the way to $3,550 levels. Also, the daily trading volume for Ethereum has shot up by 84% all the way to $14.8 billion.

Ethereum Futures Traders Sell Aggressively

With Ethereum’s price struggling to surpass the $4,000 mark, traders might want to focus on the behavior of futures market participants, as per the CryptoQuant report. The chart below displays the 7-day moving average of the Taker Buy Sell Ratio, which measures the relative aggressiveness of buyers versus sellers. A value above one indicates buyer dominance, while a value below one indicates aggressive selling.

As shown in the chart, the ratio has failed to rise above one and has been declining sharply in recent days. This trend suggests that most futures traders have been selling Ethereum aggressively, either for speculative purposes or to realize profits. This significant drop in the metric is a bearish signal, indicating that the current downward retracement could continue if this trend persists.

On the other hand, Santiment’s Network Realized Profit/Loss (NPL) suggests that holders are selling at significant profits, while steep dips indicate holders realizing losses, potentially signaling panic sell-offs and investor capitulation.

For ETH, the NPL indicator spiked dramatically from 36.69 million on June 10 to 1.06 billion on June 11. This positive trend indicates that holders are selling at substantial profits, hinting at the formation of local tops.

Uncertainty Surrounding Spot Ether ETF Approval

Analysts believe that ETH is failing to catch the bullish momentum as there’s no clarity on how long it would take for the SEC to approve the S-1 filings. Despite the Ethereum investment inflows hitting record last week, investors aren’t sure whether this shall continue further.

However, even if the U.S. Securities and Exchange Commission (SEC) approves filings from BlackRock, Fidelity, VanEck, and other firms this week, investors worry that the current market conditions are not conducive to demand for Ethereum ETFs.

For the Ethereum price, there’s a notable support zone, comprising the 100-day moving average at $3,430 and the 0.5 Fibonacci retracement level at $3,419.

It will be interesting to see whether the Ethereum whale accumulation continues or not going ahead. Additionally, macroeconomic concerns are showing further signs of stress.

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Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.