he price of Ethereum has fallen more than 20% since July, but on-chain data suggests that the correction may end soon.
After peaking above $4,000 in March, Ethereum plummeted. However, two on-chain indicators suggest that the return of leveraged traders could reverse the downtrend.
Ethereum Price Falls Over 20% From July Highs
Ethereum reached a record high of $4,066 on March 12, but has retreated significantly since then. As of August 20th, ETH is trading around $2,600, down more than 23% from its July 23rd high of $3,500.
The decline sent Ether below a key $3,000 support level that it held through most of 2023. However, the metrics suggest that the correction may be in its late stages.
Open Interest and Buyer Strength Rising
According to a report by analyst Burak Kesmeci, two metrics indicate that customers are starting to return to Ethereum. First, open interest in ETH options rose to about $10.7 billion, up 10% yesterday.
Second, Kesmesi shows the ratio of takers to buyers, which shows how buyers and sellers are on the exchanges. This metric has become positive again after favoring sellers during Ethereum’s decline.
The analyst believes that traders will need to return to long positions to keep prices up. Open interest reached $13.7 billion when Ethereum peaked in March. When ETH retested $3,800 in June, open interest was over $15 billion.
ETH may need to regain key levels such as $3,000 before a definite change in trend is confirmed. For now, after extended sales, buyers seem to be slowly regaining dominance.
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