One can determine market sentiment by a variety of varied indicators. Among them, we can see the interest in the derivatives of some cryptocurrency, and in the case of ETH, the scenario is somewhat discouraging. Even though Ethereum’s EIP-1559 update is on its way, traders are not showing an enthusiasm for ETH like one might expect. At least not as far as the short term is concerned.
The hard fork is scheduled for July, and its main proposal, dubbed EIP-1559, will limit Ethereum’s gas rates. That’s why ETH price action in June could be related to dissatisfied miners as the network migrates out of Proof of Work.
Even though ETH had an increase of almost 200% in the first half of 2021 versus Bitcoin’s modest 22% price increase, optimism is higher with respect to BTC.
What data do you have about the lack of optimism about ETH?
In addition to the diminished interest in ETH derivatives, the flow of institutional money to the cryptocurrency decreased as well. Specifically, ETH investment vehicles recently suffered record outflows of US $ 50 million. In contrast, Bitcoin flows began to stabilize.
Uncertainties are on the rise for ETH investors. Perhaps miners who support a competitive chain of smart contracts or some other unexpected turn of events could further negatively affect the price of Ether.
However, a premium of 4% to 8% on ETH’s December future contracts should be sufficient to offset those effects. However, when futures trade below this range, it indicates that there is a bearish sentiment in the short term. While overall market sentiment is neutral to bearish, it seems sensible to predict a more discouraging scenario for Ether. The uncertainties of the transition to Proof-of-Stake (POS) play an interesting role here.
A stronger fall of Bitcoin could also hit altcoins. Considering that the cryptocurrency has been showing a neutral to bearish trend, it is one more uncertainty to add to the list. At the time of writing, ETH is worth $ 2,101, with a loss of 1.20% in the last 24 hours according to CoinDesk. Also, according to TradingView, at the moment there are 11 technical signals from the last 24 hours that indicate a latent sell signal in the ETH market.
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