Ethereum’s 30-day NVT ratio has dropped to historic lows, showcasing exceptional network activity in relation to its current market cap. Historically, deep NVT bottoms have frequently signaled strong rebounds, as signs of undervaluation tend to attract renewed buying momentum. However, these patterns have also aligned with unsustainable transaction spikes that did not sustain lasting growth. Ethereum finds itself at a pivotal crossroads with this dual possibility.
The stark contrast between value and activity indicates that investors need to consider if the current inflows signify genuine adoption or merely fleeting speculative movements. Ethereum’s Open Interest has surged to $32.27 billion, reflecting a 4.11% increase over the past 24 hours, as of the latest update. This consistent rise indicates an uptick in speculative positioning, as traders broaden their long and short exposure. In the past, rising open interest in bullish trends frequently heightens volatility as leveraged participants vie for dominance. This growth, if maintained, indicates a strong belief in Ethereum’s potential for a breakout. However, it also raises the risk of sharper liquidations, especially near clustered levels like 4,700. The market’s readiness to embrace risk underscores Ethereum’s changing position as traders gear up for significant actions.
Liquidation charts reveal that shorts are facing significant pressure. The derivatives market for Ethereum shows a notable imbalance in positioning. The latest figures indicate that more than $14 million in short positions have been liquidated, compared to only $3 million in long positions. This notable disparity indicates that bears are presently shouldering the most significant losses, while bulls continue to hold a position of relative dominance. Repeated short squeezes frequently signal upward extensions, particularly when open positions do not adjust to lower leverage. Nonetheless, although the current momentum leans towards buyers, a sudden wave of profit-taking could swiftly alter the landscape. This highlights the delicate state of Ethereum’s liquidation environment at the present price points.
Binance clusters are now redirecting their attention to more elevated arenas. According data, $4,700 has been pinpointed as the crucial pressure zone. As Ethereum surpasses this level, attention turns to the upcoming clusters. Significant leverage levels persist just above the breakout area, indicating that volatility may escalate as prices explore upper ranges. If Ethereum maintains its momentum, a series of liquidations could lead to a rapid move toward the $4,900–$5,000 range. On the other hand, a failure for ETH to maintain levels above $4,700 might lead to a significant retest. Despite the significant squeeze on shorts, the odds appear to favor bulls maintaining dominance during this period.
Ethereum’s recent surge past $4,700 signals a strong bullish trend, bolstered by undervaluation on NVT, increasing open interest, and ongoing short liquidations. As Binance’s leverage clusters trend upward, the conditions appear to strongly support a move toward $5,000. The unique alignment of on-chain activity and derivatives data indicates that Ethereum is stepping into a new expansion phase, with momentum strongly supported by buyers.