Key Takeaways
Ethereum is on the fringe of value discovery with document Open Curiosity. Robust FOMO might flip the script right into a squeeze as a substitute of a sell-off.
We’re solely midway by way of Q3, and Ethereum [ETH] has already logged its strongest quarterly efficiency on document, delivering good points north of 90%. That’s a decisive win for short-term holders (STHs).
In the meantime, with value sitting simply 3% under value discovery, long-term holders (LTHs) are additionally seeing their value foundation reclaimed as Ethereum revisits its 2021 highs.
All in all, market sentiment is firmly in FOMO territory. And in accordance with AMBCrypto, this sort of risk-on setup may very well be precisely what ETH must kick off its subsequent leg increased.
Leveraged bets heating up as Ethereum eyes breakout
Over $3 billion has flowed into Ethereum by way of spot ETFs this week alone. This indicators sturdy accumulation across the $4,200 zone, pushing costs up 12% over the identical interval.
And but, ETH’s Futures quantity bubble was at 0.32%, at press time, signaling above-average leveraged exercise. Spot quantity, in the meantime, sat at 0.21%, reflecting strong however comparatively subdued spot market participation.
Supporting this, Glassnode knowledge confirmed that ETH Futures Open Curiosity (OI) reached a brand new all-time excessive of $35.5 billion as spot costs approached $4,590.
This displays heavy by-product positioning alongside ongoing spot demand.
Supply: Glassnode
Put merely, although spot demand is heating up with bids stacked on the orderbook, derivatives exercise is operating even hotter. This sort of risk-on setup typically units the stage for volatility if spot demand eases.
In June’s retracement, ETH Futures OI peaked above $20 billion, however spot demand fell, with the spot bubble dropping to 0.03% whereas futures stayed sizzling at 0.23%.
That’s the place FOMO comes into play. If Ethereum can’t maintain key resistance ranges, an identical deleveraging part might observe, making the spot volume bubble a key metric to look at.
