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3 key Ether derivatives metrics suggest $1,600 ETH support lacks strength

Published 08/03/2022, 05:15 PM
Updated 08/03/2022, 07:00 PM
3 key Ether derivatives metrics suggest $1,600 ETH support lacks strength
BTC/USD
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ETH/USD
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Ether (ETH) price is up 60% since May 3, outperforming leading cryptocurrency Bitcoin (BTC) by 32% over that span. However, evidence suggests the current $1,600 support lacks strength as network use and smart contract deposit metrics weakened. Moreover, ETH derivatives show increasing sell pressure from margin traders.

The positive price move was primarily driven by growing certainty of the Merge, which is Ethereum's transition to a proof-of-stake (PoS) consensus network. During the Ethereum core developers conference call on July 14, developer Tim Beiko proposed Sept. 19 as the tentative target date for the Merge. In addition, analysts expect the new supply of ETH to be reduced by up to 90% after the network's monetary policy change, thus creating a bullish catalyst.

Total value locked by market share. Source: Defi Llama
Ether 30-day options 25% delta skew: Source: Laevitas.ch
Bitfinex ETH margin longs. Source: Coinglass

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