Ethereum High Timeframe Open Interest Breakdown Confirms Market Reset Phase — What This Means

Ethereum’s high-timeframe structure exposes the fallout from the leverage ￰0￱ Interest has cratered, reflecting widespread liquidation across futures ￰1￱ leverage drained and traders shaken out, the path forward depends on whether spot demand can fill the vacuum left by the OI ￰2￱ recent market volatility has presented a critical opportunity to assess the underlying health of various crypto ￰3￱ an X post, Daan Crypto Trades, a full-time crypto trader and investor, has offered a compelling analysis of Ethereum’s high-timeframe chart, specifically focusing on Open Interest (OI), which shows exactly how much speculative excess has been washed out.

Particularly, ETH got hit hard in the ￰4￱ This Flush Could Be The Foundation For Ethereum’s Next Move According to Daan, what’s encouraging is that ETH’s Open Interest is now sitting at levels comparable to when ETH traded at $3,000. Meanwhile, the price now hovers around $4,000. For Daan, a simple rule of thumb to determine whether a healthy reset has occurred is if open interest is lower than it was previously at a specific ￰5￱ Reading: Ethereum Shows Strength – Bulls Aim Higher As ETH Eyes Potential Outperformance Typically, as price increases, Open Interest tends to rise as more capital flows into derivative markets, and vice ￰6￱ relative comparison of OI and price is crucial because an increase or decrease in price will generally make OI trend in both ￰7￱ are also coins used as margin, which can inflate OI figures in a rising market.

Thus, the relative levels to watch out for are between OI and price, which carry more weight than the absolute ￰8￱ the meantime, leverage is making a comeback in the Ethereum ￰9￱ the Master of Crypto, an observer of market dynamics, has highlighted, the Open Interest on ETH has surged 8.2% within 24 hours, fueling the ongoing price ￰10￱ surge in Open Interest suggests that traders are once again opening aggressive long positions after the recent flush, a familiar pattern that often carries more risk than ￰11￱ of Crypto advises caution, framing this leverage-driven rally within a historical context, that approximately 75% of rallies aggressively fueled by such a rapid build-up in leverage tend to reverse, while only 25% sustain their momentum ￰12￱ Calm Phase Before The Next Expansion The Ethereum macro trend remains upward despite the short-term ￰13￱ EtherNasyonaL has emphasized that after breaking free from its long-standing downtrend, ETH is currently only retesting the demand zone and trendline, a healthy bullish move retest that is typical of a strong market ￰14￱ Reading: Ethereum Price At Risk – Momentum Fades As Bears Target Fresh Lows Ahead However, the analyst pointed out that the fluctuation on the short timeframes doesn’t define the trend, but it’s the longer timeframes that hold the true directional signal.

Currently, “ETH macrotrend is still upward, and the bigger picture hasn’t yet spoken.” Featured image from Pixabay, chart from ￰15￱