Ethereum Longs Pushing Strong with Many Factors Backing Them But Shorts are also Strong

While altcoins are surging, the second-largest cryptocurrency has been relatively silent, not as much as bitcoin but pretty subdued still.

But things might change for Ether as well as the traders bet on an uptrend.

ETHUSD longs on Bitfinex have reached yet another all-time high. These longs have been surging for more than two years, since March 2018. Earlier this year, they went parabolic. In the past five months, they spiked more than 200%.

The notional value of ETH longs was $308 million in mid-March, which has now risen to $444 million.

In 2020, ETHUSD shorts also jumped but at a higher percentage than the longs at 393% in the past six months. But unlike longs, they are still far away from its all-time high in December 2018, as per TradingView.

For now, Ether is in the green barely while trading at $241. In the past seven days, it has spiked 7% and 89% YTD. Experts are expecting Ether to outperform Bitcoin in the near future.

Also, Ether’s implied volatility is moving up, and total open interest on futures is now near its peak.

Analyst Pentoshi also notes, “We are seeing the largest bullish divergence ever in regards to daily active addresses and price in Eths history. With DeFi, + 2.0, I can’t help but think the next year is going to be wild.”

Potential Ether Drivers

The seven-day moving average of the number of active Ether addresses has peaked to 405,014 — the highest level in two years, May 2018.

Active addresses are the unique addresses that are active as a sender or receiver on the network. While this week, this number is slightly down from last week, it is still up 115% from Jan. 30 low of 180,750.

This increased activity could be the result of Ethereum-based Decentralized Finance (DeFi) platforms and stablecoins, especially the daily USDT transaction on the network, which has increased by more than 400% this year.

Already, close to a record, 3.1 million ETH are locked in various DeFi projects. Moreover, $60 million worth of BTC moved to Ethereum last month, and Wrapped Bitcoin is responsible for about 75% of this growth.

Amidst this, the Dapp report shows Ethereum users doubled compared to the first quarter, and DeFi application Compound was the one responsible for this, which pushed the volume over $10 million in Q2 2020.

This heightened demand is expected by many to fuel Ethereum’s bull run.

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Author: AnTy

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