Ethereum approaches a new ATH, but derivatives data reflects mixed emotions

Today’s Ether (ETH), price briefly touched $4760. This was a great moment for investors and a reminder to the rest of the world that the altcoin remains 2.2% below its all-time high of $4,870 20 days ago. The spot price action is interesting, but let’s look at what’s going on in Ether’s derivatives market.

Bitstamp: Ether USD/ETH price Source: TradingView

It is possible to draw an ascending channel showing support at $3,000. However, today’s positive move of 5.4% seems disconnected from Bitcoin’s (BTC), negative performance.

Today’s commodities and stocks fell after the U.S. Federal Reserve admitted that inflation is not a temporary trend. Fed chair Jerome Powell stated that the bank’s loose money policies may end sooner than expected.

Retailers aren’t confident

The perpetual contracts futures data can be used to determine how confident traders are regarding Ether’s price recovery. Because its price tends towards the regular spot market, this instrument is preferred by retail traders.

Futures contracts trades have both buyers and sellers. However, their leverage is different. Exchanges will charge a funding fee to the side that requires more leverage. This fee is also paid to the opposite side.

8-hour funding rate for Ether perpetual futures. Source:

The 0% to 0.033% positive funding rate for neutral markets is equal to 0.6% per semaine. This suggests that longs pay and data shows that retail traders have been mostly neutral in their funding rates since Nov. 4, and the last movement above 0.07% was Oct. 21.

Top traders have reduced long positions

The long-to-short net position of traders is highlighted by exchange-provided data. It is possible to determine whether professional traders are bullish or bearish by analyzing the position of every client on spot, perpetual, and futures contracts.

Sometimes there are discrepancies between the exchanges’ methodologies. Therefore, viewers should be able to monitor these changes and not just absolute numbers.

Top traders in ETH exchanges – Long-to-short ratio Source:

Top traders at Huobi, OKEx and other exchanges reduced their longs despite Ether’s 17% rise over the past four trading days. OKEx was more observant as the indicator changed dramatically from favoring bulls 120% on Nov. 25, to a mere 30% advantage three days later.

Data currently shows that arbitrage desks and whales have decreased their long exposure. Retail traders are still suspicious about the recent bull market.

Risk is inherent in every investment or trading move. Before making any investment or trading move, you should do your research.

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