Ethereum Open Interest Jumps 18%, Bull Trap Signal?

Ethereum’s futures market activity expanded as the ETH price rose, with open interest rising more than 18%.

According to Maartunn, Ethereum open interest has gained more than 18%, leading all growth among major cryptocurrencies.

As seen on the CoinGlass website, open interest in ETH futures rose 19.15% to $33.37 billion. Total futures open interest across various cryptocurrencies increased 9.43% in the last 24 hours to $113.78 billion, a sign of increased risk-taking on the market.

The growth in OI on most major cryptocurrencies comes with positive perpetual funding rates and cumulative volume deltas. This setup indicates increasing demand for bullish leveraged plays.

On Deribit, however, puts tied to Ethereum continue to trade pricier than calls across all time frames, which might indicate continued desire by traders to hedge against downside risks irrespective of the market rebound.

Bull trap signal?

Ethereum rose for seven consecutive days from March 9 and is set to mark its eighth day if today closes in green.

At the time of writing, ETH was up 7% in the last 24 hours to $2,299 amid a broader rise in the market that has seen altcoins outperform Bitcoin, with some posting double-digit gains.

The recovery on the market had a short squeeze behind it. CoinGlass data shows $398 million in total liquidations over the past 24 hours across 96,385 traders, with short liquidations accounting for the majority at $320 million. Ethereum shorts were hit hardest at $141 million.

If buyers do not allow the ETH price to return below $2,036, it boosts the chances of a rise toward $2,600. Ethereum bulls appear to be targeting $2,800 as their next stop, but ETH futures data shows a divided market, with limited odds for a sustained 33% rally.

If the price drops from current levels, Ethereum may continue in sideways trading between $1,750 and $2,200 for some time.