During today's trading session, Ethereum and cryptocurrency markets have shown strength and are trading in green. The expectations surrounding the upcoming major upgrade of ETH in "Shanghai" may support a positive price trend
During today's trading session, Ethereum and cryptocurrency markets have shown strength and are trading in green. The expectations surrounding the upcoming major upgrade of ETH in "Shanghai" may support a positive price trend.
The upgrade scheduled for April 12th will allow Ethereum 2.0 validators to unlock their locked ETH. Therefore, the available supply of cryptocurrency will inevitably increase, which may translate into negative price trends.
So far, due to the optimism of traders, the situation has been exactly the opposite. At the time of writing, the trading price of Ethereum (ETH) was approximately $1900, with profits of 3% and 5% in the past 24 hours and the previous week, respectively.
Selling or not selling, a dilemma for Ethereum investors
According to cryptocurrency analysis company Blofin, the ETH supply locked in the "beacon chain" (PoS blockchain that supports the transition to this consensus algorithm) is in a loss state. Therefore, even after "Shanghai", investors have little incentive to sell their ETHs.
These investors are more likely to wait for ETH to recover their previous losses, which may support their bullish price trend and expand the rally to a high of $2000. However, Blofin warns:
The upgrade of Ethereum Shanghai is just around the corner, but this has not led to increased selling pressure, as most of the mortgaged Ethereum is currently in a loss making state. But the risk of selling cannot be ignored, and the macro uncertainty surrounding upgrading is also increasing.
In the option market, Blofin recorded investors' risk aversion, which turned into "stable" market dynamics. There have been some changes in the implied volatility (IV) of ETH option contracts and speculative activities around cryptocurrencies.
BitStarzPlayer achieved a record victory of $2459124! Can you become the next big winner?
In this sense, most ETH option traders establish long positions by purchasing short-term call option contracts. This dynamic can support further profits for ETH, but Blofin emphasizes risk aversion sentiment:
After upgrading in Shanghai, most ETH option bulk traders are optimistic about ETH. It is worth noting that some traders purchased the price difference of call option due in the first quarter of 2024. Considering the asking price difference of annual options, this is more likely to be a transaction driven by risk management or arbitrage.
Other data from BitfinexAlpha indicate that the ratio of put option to call option of ETH options has soared. As shown in the figure below, the ratio is below 1, indicating that investors' bullish sentiment is dominant, with bullish (buy) contracts being more prevalent than bearish (sell) contracts.
Disclaimer: The content of this article is sourced from the internet. The copyright of the text, images, and other materials belongs to the original author. The platform reprints the materials for the purpose of conveying more information. The content of the article is for reference and learning only, and should not be used for commercial purposes. If it infringes on your legitimate rights and interests, please contact us promptly and we will handle it as soon as possible! We respect copyright and are committed to protecting it. Thank you for sharing.(Email:[email protected])
