Ethereum Netflow Rises in Derivatives — A Price Swing Ahead?

Ethereum (ETH) has had a dismal period in recent weeks, with modest price jumps but no sustained advance beyond $3,000.

An Ethereum netflow movement has been fascinating behind the scenes of this pricing fight, according to a CryptoQuant expert.

Ethereum's netflow change might affect the market's response, either favorably or adversely.

Taha believes this surge may signal traders are planning for price swings, since substantial transfers to derivatives platforms have traditionally preceded volatility or corrections.

Based on Taha's research and prior jumps in May and early July, Ethereum's recent activity may indicate a market upturn. Analyst wrote:

The current netflow increase may indicate a price correction or trader positioning-driven fast rise.

Market Sentiment from Bitcoin

Taha examined Ethereum's netflows and Bitcoin's Futures Sentiment Index, which reveals sentiment peaks that may indicate market action.

He identified three red-circled sentiment index spikes (in the chart above) that coincided with local market tops. Bitcoin's price usually falls once trader sentiment surges.

The mood index is a “contrarian indicator” since market corrections generally follow optimistic peaks. These mood patterns suggest Ethereum, which is heavily associated with Bitcoin, may be volatile.

Meanwhile, Ethereum remains below $3,000. The asset has fallen 3.1% in the previous week. The prior day's performance is trying to improve.

Ethereum has gained 0.9%, reaching $2,559 earlier today before trading at $2,541.

The asset has fluctuated over $2,700 and below $2,500 in the last week, but Ethereum daily trading volume has remained stable.

Coingecko data reveals this statistic has traded between $15 billion and $19 billion this week without a notable change.

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