Ethereum Nears a New All-Time High, But Rally Scare Derivatives
Ether is in a bit of a rally at the moment, with the altcoin revolving around $4.7k. Although ETH is 2.2% away from reaching its all-time-high of $4.8k it attained 20 days ago, the current rally is no doubt exciting investors.
However, the rally doesn’t appear to have caught the fancy of a particular set of people – the pro investors. The derivatives market is a bit shaky about the situation, given that earlier today, the commodities and stock nosedived after the United State’s Federal Reserve agreed that inflation is more than a transitory trend.
Fed Chairman Jerome Powell also stated that the relaxed monetary policies could end very soon, given the circumstances.
ETH price moved 5.4% today, but the bull is a complete contrast to BTC’s performance in the market. The flagship asset is trading below $57.5k as of the time of this publication, nearing the lower end of the support of $56k.
Retail Traders Are Skeptical
The confidence in ETH price is somewhat low and that’s because of the contracts futures data. The popular altcoin’s price recovery may not look as it seems.
In any contract futures – the instrument used by retail traders to track spot markets, longs are usually matched with shorts, but the leverage differs. Ultimately, the side that demands more leverage will pay a fee to the other side.
Neutral markets usually display a positive funding rate of 0% – 0.03%, indicating that longs are paying mostly. According to perpetual futures 8 hours funding rate data from Coinglass, retail traders have been neutral since November 4, and the last known recorded movement happened late last month.
Exchange Data Indicates Reduced Positions
Various exchanges have pointed out trader’s long and short positioning, their correlation, and the outcome of the market, whether it would be bearish or bullish.
Of course, each exchange showed some discrepancies in the methodology, but the changes were very similar. Data from Huobi and OKex platforms reveal that traders’ long positions decreased, despite Ether’s 17% rally in the past four days
OKex exchange even provided more clarity on the trading positions. According to the data, the indicator made a movement from showing sentiments towards bulls by 120% on 25th of November to 30% on the 28th.
Presently, data shows that whales have minimized their long exposure, while retail traders remain skeptical about the current price rally.
Some investors are still positive of the new week’s outcome. Though BTC plunged again, it’s still above the lower end of support, indicating that a rebound could still happen. SHIB also rebounded during the week, after news of Kraken listing and Newegg support.
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