On November 8 and 9, Ethereum [$ETH] saw a combined $432.34 million in leveraged positions liquidated. The $ETH price subsequently fell from $2,236 to $2,060.
This was Ethereum’s largest liquidation wave since August 19, when $1.02 billion in short positions were liquidated in a single day.
At the time of writing, Ethereum was trading just above $2.1k. Swing traders and investors would be watching the psychological $2,000 level closely to gauge whether another wave of selling was approaching.
In other news, Vitalik Buterin explained why Ethereum as a store of value made “more sense to focus on” than $ETH as a fee-burning token.
Ethereum’s Open Interest declines notably
Ethereum’s 30-day rolling Open Interest Z-Score fell to -2.87. Crypto analyst Arab Chain, using Binance data, reported an unusually sharp decline in Open Interest (OI) for $ETH contracts.
OI stood at $5.236 billion, compared with a 30-day average of $5.850 billion and a standard deviation of $213.77 million. This put current OI about 2.87 standard deviations below the 30-day average.
Meanwhile, sustained selling pressure has driven the leading altcoin’s price down toward $2,100. The falling OI alongside downward price pressure could reflect the closure of existing positions through liquidations or manual exits.
The analyst wrote that this did not necessarily mean sizable short positions had been opened.
Will Ethereum prices sink further?
After losing the $2,358 swing point, $ETH’s price structure turned bearish. The $2,400 area has since been retested as resistance, and the price reacted bearishly there in November.
OBV was relatively flat over the past ten days, but had been gradually declining since early October. The MACD was also falling and signaled strong bearish momentum at the time of writing.
The round-number support at $2,000 was one level to watch. Investors could also look for a bullish reaction in the $1,840–$1,950 demand zone, where $ETH consolidated in July and August.
Final Summary
- Ethereum saw its largest liquidation volume since mid-August earlier this week when it dipped from $2,246 to $2,060.
- The Open Interest witnessed an unusually sharp decline compared to its 30-day average, signaling reduced risk appetite and a marked decline in leveraged positioning.
Source: ambcrypto.com. Adapted by NBTC.
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