Connect with us
Active Currencies 14894
Market Cap $2,219,211,043,895.70
Bitcoin Share 50.81%
24h Market Cap Change $-1.52

Ethereum’s $50M liquidations – Here’s what traders should know

2min Read

ETH’s price action has been in the middle of a lot of volatility lately.

Ethereum's $50M liquidations - Here's what traders should know

Share this article

  • Both longs and shorts experienced a turbulent time after ETH’s price went up and down
  • Realized Profits increased, indicating that the value may fall below $3,400

The high volatility in the market caused liquidations in the market to hit $215 million. Out of this, Ethereum [ETH] contracts accounted for $50.61 million, according to data from Coinglass.

Liquidations occur when a trader does not have a sufficient margin balance to keep a position open. The forceful closure is necessary to avoid further losses.

Stormy season for the market

For ETH, the high liquidations could be linked to the cryptocurrency’s price. A look at the price action revealed that it dropped to $3,368 at some point on 14 June. Later on, the value rose to $3,512, before settling above $3,500 at press time.

As a result of these price swings, both longs and shorts were not spared. Longs refer to traders betting on the price of an asset to hike. Shorts, on the other hand, are traders with stakes on a price decline.

ETH hit a high liquidations number

Source: Coinglass

However, traders seemed to expect the depreciation in price. This, because of the Put/Call ratio before Friday’s options of expiry. According to Deribit, the derivatives exchange, Ethereum’s Put/Call Ratio was 0.37.

Since the ratio was below 0.50, it meant that expectations have been bearish. However, it did not seem the participants anticipated the high level of volatility.

In terms of the price, AMBCrypto looked at the Realized Profit too. As the name implies, this denotes the total of all moved coins whose last price was lower than its press time value.

ETH plans to swing between $3,400 and $3,600

On 12 June, ETH’s Realized Profit was $55.18 million. By 14 June, the value had risen to $104. 58 million. An increase in this metric implies that holders are booking profits, and this could lead to a price fall on the charts.

However, if the metric stabilizes itself, selling pressure reduces across the market. For Ethereum, Realized Profit seems to have settled around the aforementioned value. Therefore, it might be likely for the altcoins to trade between $3, 400 and $3,600 over the next few days.

Ethereum realized profits increase

Source: Glassnode

AMBCrypto also analyzed Exchange inflows and outflows to assess ETH’s next movement. Exchange inflows track the number of coins sent into exchanges.

If this increases, it means that holders are planning to sell. When this happens, the price of a cryptocurrency usually decreases. Exchange outflows, on the other hand, measures the number of coins sent out of exchanges.

At press time, ETH’s Exchange inflows were $34,400 while the altcoin’s outflows were 24,100. The difference in the flows implied that there were more ETH up for sale, than those retired to cold wallets.

ETH price faces selling pressure

Source: Santiment


Read Ethereum’s [ETH] Price Prediction 2024-2025


If this continues, the price of the cryptocurrency might drop below $3,400 like it did on 14 June. On the other hand, a fall in selling pressure could halt this decline and ETH might keep consolidating on the charts.

Share

Victor Olanrewaju is a full-time journalist at AMBCrypto. Settled in Lagos, his fascination with blockchain technology and the cryptocurrency market arose out of his love of freedom and everything free. As a Nigerian, Victor understands the impact unfounded financial restrictions have on a population. He sees Bitcoin and cryptos as a way to circumvent these obstacles, as a tool for value creation despite all the setbacks. A graduate in Physics, Victor previously worked as a Senior Marketer at Melange Technologies. Before that, he dealt with crypto-marketers on a regular basis in his capacity as Copywriter at Ventrix Media. At AMBCrypto, Victor’s focus is on assessing the real effectiveness of both on-chain and off-chain developments on a project and its community sentiment.
Read the best crypto stories of the day in less than 5 minutes
Subscribe to get it daily in your inbox.
Please check the format of your first name and/or email address.

Thank you for subscribing to Unhashed.