Ethereum is still struggling to break above the $2,000 mark, indicative of ongoing selling pressure and fragile market sentiment. The failure to surpass this critical level has led traders to adopt a defensive posture, resulting in heightened volatility and weakened confidence as negative outlooks spread throughout the wider cryptocurrency market. Corrections after substantial cycles are common, yet the current situation reveals visible stress, with investors monitoring liquidity and derivatives for indications of potential price movements.
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A recent report from CryptoQuant sheds light on a notable decline in Ethereum futures open interest. Data showing the 30-day change in net open interest across major exchanges suggests that the derivatives market is currently experiencing a phase of deleveraging and risk reassessment. This decline is primarily occurring on platforms like Binance, Gate.io, OKX, and Bybit, indicating a broad capital outflow from leveraged positions.
Recent figures show that Binance alone has seen an approximate decrease of 40 million ETH in open interest over the past month, while Gate.io has lost over 20 million ETH. OKX reported a decline of nearly 6.8 million ETH, and Bybit contributed around 8.5 million ETH, leading to a total contraction of about 75 million ETH across these exchanges.
Widespread Deleveraging Indicates Market Reset for Ethereum
The CryptoQuant report further highlights that when including other platforms with negative open interest figures—albeit with smaller volumes—the total decline exceeds 80 million ETH over the past month. This indicates that the deleveraging trend is widespread and not limited to a few dominant exchanges, reflecting a structural shift within the Ethereum derivatives market.
This extensive decline in open interest typically signifies that traders reliant on leverage are pulling back rather than taking new speculative positions. Such behavior may arise from caution following increased volatility or pressures from recent price drops, which require margin adjustments. Historically, similar conditions arise during transitional phases in the market when speculative enthusiasm wanes, and risk management becomes paramount.
Ethereum Under Structural Pressure Below Critical Weekly Support
The weekly chart for Ethereum illustrates ongoing downward pressure after slipping below the $2,000 mark, which had previously served as both a psychological support and a key technical pivot. This latest breakdown places ETH beneath several significant moving averages, which now act as overhead resistance, signifying a decline in bullish momentum and a shift to a more defensive market structure.
Current price behavior indicates clear rejection from the $3,000–$3,500 range earlier this cycle, followed by a series of lower highs. This pattern typically denotes a corrective or transitional phase rather than a continuation of prior upward trends. Notably, the recent decline has been accompanied by increased trading volume, suggesting distribution and deleveraging rather than genuine accumulation.
From a structural perspective, the next significant support area is near the $1,600–$1,700 range, where previous consolidation and demand have appeared. Maintaining this zone would help sustain the broader long-term framework in the face of current weakness. Conversely, a sustained break below this level could heighten the chances of a deeper retracement.
Ethereum remains particularly sensitive to macro liquidity conditions, derivatives positioning, and overall market sentiment, with any potential recovery hinging on renewed demand and stabilization above key technical thresholds.
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Featured image from ChatGPT, chart from TradingView.com
