Key Takeaways:
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Retail traders hold 94% long positions in ether, often a contractor indicator.
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ETH funding on Binance remains healthy, with modest moderation and not euphoric.
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Bitmine continues to accumulate with more than 300,000 ETH added to the reserve this week.
Ether (Eth) continues to trade below the important $4,000 threshold, struggling to establish the bullish direction of momentum following last Friday’s flash crash. The Altcoin banded between the 50, 100, and 200-day exponential moving averages (EMA), a technical zone that features an ongoing tug-of-war between short-term and long-term market trends.
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Despite the mixed technical setup, retail traders appear to bet aggressively on further upside. Data from Resource Resource Hyblock Capital outlined the True Retail Accounts (TRAS) long percentage reached the 90th percentile, one of the highest levels among major crypto assets. Hyblock said,
“Real retail Long% accounts are getting high on some coins, citing percentage readings of 94% for Bitcoin, 90% for ether, and 86% for Solana.”
Surprisingly, the firm added that retail long positioning is inversely correlated with price, at -0.86 for ETH, indicating that as retail reaches extreme highs, the likelihood of a reversal is growing.
The 90th percentile for ETH Longs suggested that retail sentiment is heavily skewed toward optimism (ie, prices are expected to rise). Historically, extreme retail positioning, especially if it reaches more serious territory (for example, 90th percentile), can act as an indicator of the contractor.
This is because it can signal overcrowding in long positions, potentially leading to a reversal if retail traders begin to take profits or become liquid.
Speaking on the derivatives market, crypto analyst Pelin Ay offered A more pessimistic view of the market structure, noting that funding rates will remain positive but restrained, signaling a market governed by Longs but not yet euphoric.
Ay explained that the current funding levels between 0.01% –0.03% indicated a healthy mid-phase uptrend, which is lower than the overheated bull-phase levels of 0.1% –0.2% seen in 2021. The analyst added that the moderate seizure and improving demand area could set the stage for a renewed rally towards $4,500-$ 5,000, while any sudden inflow into the fund above 0.05% could mark overcrowded longs Trigger short-term pullbacks.
RELATED: 95% of corporate eth buys happened in Q3 – Beginning of ether supercycle?
Institutional riches buy ether dip
Large ETH holders are also taking advantage of the recent pullback. The data showed that bitmine mining technologies, led by Tom Lee, accumulated 104,336 ETH worth around $417 million on Thursday.
This adds to Bitmine’s earlier acquisition of more than 202,000 ETH on Sunday, with the current market value of the ETH Reserve coming in at $9.3 billion. Despite the recent volatility, Lee has rewritten His year-end target of $10,000 per ETH, supported by increased institutional demand and market place.
Related: Ethereum confirms last-minute bearish signal that led ETH down 60%
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should do their own research when making decisions.
