- ethereum’s price experienced a 32% decline since mid-December, reaching $2,770 with extreme volatility on Monday.
- Trading volumes on major exchanges hit levels not seen since August, suggesting a potential selling pressure peak.
- The current pattern mirrors August 2023’s price action when ETH found support at $2,100 before rallying to $4,100.
- U.S.-listed spot ether ETFs have attracted $420 million in net inflows this week, representing 13% of total inflows since launch.
- Large options trades indicate institutional investors are positioning for a potential rally to $5,000 by late 2025.
Ethereum‘s price volatility has reached levels not seen since September 2021, with the cryptocurrency experiencing a dramatic swing from $2,000 to $2,700 in a single day. The movement comes amid increased trading activity and institutional interest, suggesting a potential market bottom similar to patterns observed in early August.
The second-largest cryptocurrency has underperformed Bitcoin, dropping 32% from its mid-December levels. However, data from major exchanges like Coinbase and Bitstamp shows trading volumes surging to August-comparable levels, typically a signal of selling exhaustion.
“I am noting strong over-the-counter demand for ETH, which is particularly noteworthy amid broker chatter around a fund blowing up amidst weekend volatility,” reports Jake Ostrovskis, an OTC trader at crypto market maker Wintermute.
Institutional interest remains robust, with U.S. spot ether ETFs recording $420 million in net inflows this week, according to Farside Investors. This represents nearly 13% of the total $3.18 billion inflow since these products launched, indicating sustained institutional appetite despite recent price volatility.
Options market activity suggests longer-term bullish sentiment, with significant positions taken in call options expiring December 2025. A notable bull call spread strategy emerged on Deribit, combining long $3,500 calls with short $5,000 calls, indicating expectations of potential upside toward the $5,000 level.
The current market structure bears striking resemblance to early August, when Ethereum found strong support at $2,100 before consolidating and eventually rallying to $4,100. This historical precedent, combined with robust institutional flows and derivatives positioning, suggests the potential for a similar recovery pattern in the coming months.
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