Bitcoin (BTC) and ether (ETH) lost pivotal support levels in the past 24 hours amid weakening sentiment for the broader crypto market – a move that caused over $520 million in liquidations, data shows.
Ether-tracked futures lost upwards of $236 million, nearly double those of $125 million on bitcoin futures. The losses were unusual for ether, which mostly sees lower liquidations than bitcoin on average trading days.
Futures of Stepn’s GMT tokens racked up $23 million in losses amid headwinds from Chinese authorities, who banned gameplay of the popular ‘step-to-earn’ protocol in the country. Futures on Solana (SOL) lost $11 million, while metaverse-focused Sandbox (SAND) saw $9 million in losses.
Crypto futures saw over $520 million in liquidations. (Coinglass)
Ether dropped to as low as $1,728 in early Asian hours on Friday, losing some 9% of its value over the past 24 hours. A sudden dip to similar price levels on Thursday night was prompted brought up by traders, but this morning’s slide was gradual.
Price-charts suggest support at current levels and resistance at $1,900, which acted as pivotal support earlier this month. Similar prices were previously seen in July 2021, and losing the level could see ether drop to the $1,300-$1,500 range or lower.
Ether fell to a level previously seen in mid 2021. (TradingView)
A fundamental reason for the drop could be a lack of demand for Ethereum’s block space, as per data from analytics firm Glassnode. ‘Gas,’ or network fees, prices have been trending downward since December and recently reached multiyear lows, the firm said in a note earlier this week.
Block space is the amount of transactional data that can be included in each block, with users paying "gas" fees for doing so. Lower block demand generally means a fall in user activity on any particular network.
Meanwhile, analytics firm Coinalyze said in a Twitter message that Thursday’s volatility in ether was succeeded by a sudden increase in open interest on ether futures. Open Interest is the amount of unsettled futures in any market, and an increase in the figure usually implies traders are opening long, or short, positions in anticipation of a move.
Ether and other major cryptocurrencies seemed to stabilize at writing time. Futures and options data for bitcoin suggests traders are positioning for a bearish period ahead, however.
All writers’ opinions are their own and do not constitute financial advice in any way whatsoever. Nothing published by CoinDesk constitutes an investment recommendation, nor should any data or Content published by CoinDesk be relied upon for any investment activities. CoinDesk strongly recommends that you perform your own independent research and/or speak with a qualified investment professional before making any financial decisions.
Recommended Content
Editors’ Picks
Ripple's move above this key level could trigger nearly 50% rally for XRP
Ripple has overcome a critical resistance level and flipped into a support floor on the weekly time frame. This development happened while XRP tightly consolidated for roughly 250 days. Investors can expect XRP to kickstart a massive rally.
Optimism price outlook with nearly $90 million worth of OP tokens flooding markets on Friday
Optimism volatility has shrunk in the ours leading to the network’s cliff unlock. It joins the likes of dYdX and Sui, which have similar events on their calendars. As token unlocks are often considered bearish catalysts, investors should brace for a reaction after the event.
Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Retail watches from the sidelines with a bias for shorts
Bitcoin could clear $73,777 peak as BTC bulls resurface. Ethereum might fall 10% before next leg up as ETH RSI teases with sell signal. XRP could lose $0.6000 threshold as Ripple bulls fail to show up.
Jito price could hit $6 as JTO coils up inside this bullish pattern
Jito price action shows a potential cup and handle formation. Based on theoretical measurement rules, a successful breakout could yield a 56% rally to $6.0. A breakdown of the $3.86 support level would create a lower low for JTO and invalidate the bullish thesis.
Bitcoin: BTC may have recovered, but is it out of the woods?
Bitcoin’s (BTC) upward momentum has shown a significant decline for the past two weeks or so. This development led to a bearish signal on the weekly and an uncertain outlook on the monthly.