As a seasoned crypto investor with over a decade of experience navigating the digital asset market, I can confidently say that the recent surge in demand for leveraged Ether-based trading products is a clear sign of increasing momentum for Ethereum. The 160% rise in leveraged product demand since Nov. 5, as reported by K33 Research, is not only impressive but also indicative of a broader shift in investor sentiment towards cryptocurrencies post the U.S. Presidential election.
The interest among investors in trading products that use Ether as collateral while borrowing funds (leverage) is rapidly growing, indicating a strong push which might propel Ethereum, currently the second largest crypto, beyond the symbolic price level of $4,000.
As an analyst, I’m observing a growing trend among investors: they are seeking opportunities to establish leveraged Ethereum (ETH) positions. This strategy allows them to temporarily borrow funds, thereby amplifying their trading power in the ETH market.
The interest for the VolatilityShares 2x Ether exchange-traded fund (ETF) has significantly increased by more than 160% since November 5, as stated by Vetle Lunde, the head of research at K33 Research, in a blog post dated November 28.
“Since November 5, the ETH equivalent exposure in the VolatilityShares 2x leveraged long ETH ETF has increased by 278,150 ETH (+160%!). VolatilityShares now hold more than half of CME’s ETH [open interest] (50.1%!!).”
Over the past three weeks following Donald Trump’s victory in the 2024 U.S. presidential election on November 5th, there has been a significant increase of 160% in demand for leverage, which has boosted investors’ interest in risky assets like cryptocurrencies.
Despite Ether’s current prices being lower than Bitcoin (BTC), many market observers anticipate a shift in this trend following the recent downturn in ETH prices. Based on developing chart patterns among technical analysts, there is an expectation that Ether could potentially reach $20,000 at the peak of the 2025 bull run.
ETF inflows and spot buying will fuel Ether’s rally to $4,000 — Analyst
As Ether ETF investments started to increase, it’s also possible that Ether’s recent price surge was driven by a rise in direct purchases from the market.
According to Ryan Lee, the chief analyst at Bitget Research, it appears that Ether may experience increased positive movement over the coming weeks.
“The implied volatility of 1-day options has remained stable, indicating that the recent breakout above $3,600 was driven by spot accumulation rather than speculative activity. This trend suggests ETH may continue to rise, and the ETH/BTC exchange rate, which shows signs of bottoming and rebounding, is worth monitoring.”
As a crypto investor, I’ve been closely watching the technical chart formations suggested by the well-known trader, Wolf, in his recent November 27 post. These indicators could potentially propel Ether to surge past the $4,000 psychological threshold.
“One way to view it is as a 3-year cup and handle, with major resistance at 4k. Once that’s cleared, a measured move places it north of $15k.”
Lee’s perspective suggests that the significant influxes of stablecoins into exchanges during November might have played a role in Ether’s surge in value.
“Sustained net inflows of stablecoins are providing liquidity to the crypto market […] This inflow trend is unlikely to reverse in the short term, suggesting that the market’s momentum will persist.”
Bitcoin trading under $100,000 could be an Ether price catalyst
On November 22nd, Bitcoin reached an unprecedented peak of $99,800, but then saw a temporary dip to around $91,000. Some financial experts predict that this decline might continue, potentially dropping by up to 30%, before the price surpasses the six-figure mark once more.
In a recent post on November 28th, well-known cryptocurrency analyst Rekt Capital proposed that Bitcoin staying within the $100,000 range might serve as a beneficial trigger for Ether’s price increase.
“Bitcoin ranging between $91,000 & $100,000 may very well be a recipe for Ethereum to take the lead and enable money flow into smaller Altcoins.”
Positive investments into Ethereum ETFs, which have been increasing for four days in a row, totaling over $90 million as of November 27 according to Farside Investors data, might also fuel the rise in Ethereum’s price.
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2024-11-28 15:05