Ethereum has been experiencing a slowdown in its bullish momentum over the weekend. The cryptocurrency managed to break the critical resistance at $1,700 but could retest previous support levels before recovering higher levels.
According to Wu Blockchain, Ethereum recently get over it Bitcoin in terms of open interest (OI) for options contracts. This metric is $5.6 billion against $4.3 billion in Bitcoin.
For the first time since the inception of these products, the price of ETH has outperformed the open interest of BTC. As noted by Wu Blockchain, most OI recorded for Ethereum options contracts are focused (buying) calls on September 30 and December 30.
Both dates are after the merger, which is a highly anticipated event for Ethereum. Mainnet “merge” provisionally scheduled for September 9The tenth.
This event will complete the migration of ETH from Proof of Work (PoW) consensus to Proof of Stake (PoS) consensus. Players in the options market appear to be positioning themselves to the upside or hedging potential short positions using other investment products.
A different perspective on the price of Ethereum
data One of the physical indicators accurately predicted short-term selling pressure with the possibility of increased volatility at the close of yesterday’s daily, weekly and monthly candlestick. These events often encourage sudden movements in the asset’s price.
As seen below, the material indices early warning indicator flashes with a short signal at yesterday’s daily close. This indicates that Ethereum has a high chance of a bearish trend.
Short-term selling pressure coincided with technical resistance at the 100-day moving average (DMA). This level inflated with increased bids as Ethereum price has trended upwards over the past couple of days.
At the time of writing, ETH is still registering $13 million in orders (sell) at $1,700. This indicates that this level will continue to act as a critical resistance for the time being.
This shift in the momentum of ETH price, as supported by prior trend recognition of the Materials Index and demand for liquidity, may translate into a further sustained downward movement of the price. As shown below, these analysts presented a possible bearish scenario for Ethereum for the coming months.
The fractal or price prediction below shows that the price of ETH may be heading lower until at least October 2022. These patterns are highly unpredictable but they can provide traders with clarity about the direction of price in the higher time frames.
Regarding the latter, analysts from Material Indicators said that the following highlights how this data provides a different view of the current ETH price narrative beyond the move to the PoS consensus:
I don’t recommend trading fractals or taking them too literally because they can skew in both the price and time range or invalidate at any time. However… all the above items paint a very compelling story of #ETH based solely on algae and TA without any of the POS (Proof of Work) -> Conversational POS (Proof of Stake)