Technical Evaluation

The Daily Chart: On the daily chart, the price has fallen significantly below $1,750 and the 200-day moving average, which is located at $1,800. The aforementioned moving average is one of the most important trend indicators, and when the price trades below it, the market is considered to be in an adverse phase.

ALSO READ:Ethereum Whales Are Aggressively Buying The Dip

The price is currently supported by the short-term support level at $1,650, and a bullish pullback appears probable. With the recent decline, however, the market structure has become adverse, and a retest of the $1,400 level in the coming weeks appears probable.

The 4-Hour Chart:

Examining the 4-hour timeframe reveals that the price fell below the large descending channel a few days ago. The decline has been exacerbated as a consequence of this collapse, with a large wick breaking through the $1,650 level.

Nonetheless, the price has been sustained by the level mentioned until this point. Additionally, the RSI indicator has recovered from the oversold region, indicating a possible consolidation in the near future. Nevertheless, based on recent price activity, it is likely that prices will continue to decline.

ALSO READ:France investigates Binance for alleged money laundering

Open Interest for Ether

After several weeks of consolidation in a narrow range, the price of Ethereum has experienced a precipitous decline over the past few days. Typically, futures market liquidations cause these abrupt price movements.

This graph displays the Open Interest metric, which gauges the total number of open positions in perpetual futures markets. Most often, high values result in volatility.

ALSO READ:OKX, a leading cryptocurrency exchange, will expand operations in Dubai, UAE.

As indicated by the graph, the recent decline was accompanied by a precipitous decline in Open Interest. Therefore, it could be interpreted that the futures market was once again responsible for the recent decline, as the significant reduction in Open Interest indicates that the market went through a lengthy liquidation cascade.

Since there are currently fewer leveraged positions open, one can anticipate more stable price action in the near future.