Since the launch of U.S.-based spot Ether ETFs on July 23, Ether’s price has dropped by over 26%. However, according to CryptoQuant author Burak Kesmeci, this correction might be nearing its end, supported by two on-chain metrics indicating a potential shift.
Taker Buy-Sell Ratio Turns Positive
One promising sign is the Taker Buy-Sell Ratio, which measures the ratio of buyers to sellers for Ethereum across all exchanges. This metric has recently turned positive, suggesting that buyers are starting to regain their strength. A positive Taker Buy-Sell Ratio at the start of the week is seen as an encouraging sign that the market could be stabilizing.
Open Interest Shows Shift
Another important metric is Open Interest (OI), which represents the total of all open long and short positions. In June 2024, when Ethereum’s price peaked at $3,800, OI hit a record high of over $13 billion. This high level of OI indicated that a market correction was likely, and indeed, a correction followed. By August 5, 2024, following a Japanese stock market crash triggered by rising interest rates from the Bank of Japan, Open Interest (OI) had fallen to $7 billion. However, it has recently increased to $7.9 billion, reflecting a 1.8% rise in the last 24 hours.
What To Expect?
After a period of high trading volume on the leverage side and subsequent liquidations triggered by macroeconomic events, the current data suggests that buyers are slowly regaining strength. However, it remains to be seen if this recovery is just a temporary bounce or the start of a more significant bullish trend.
According to CoinGlass data, Ethereum faced $111.2 million in liquidations recently, with $47 million from long positions and $64.2 million from short positions, affecting 43,549 traders. As of now, Ethereum is trading around $2,658, up 1.56% in the last 24 hours. Additionally, ETH’s trading volume has surged by 27%, with its market cap at approximately $320 billion. Meanwhile, the Stochastic Oscillator on the 4-hour chart suggests a potential price recovery for ETH, as it has dropped below the 20 mark and entered the oversold zone. On the flip, the Relative Strength Index (RSI) is showing a bearish trend after falling below its midpoint.
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