There has been a substantial increase in institutional interest in Ethereum (ETH) during November, with CME Futures Open Interest (OI) reaching an all-time high of 662,600 ETH (approximately $2.5 billion).
According to K33 Research, this surge marks a significant rise from 350,950 ETH on 4 November, just before the U.S. Presidential elections.
Approaching Parity with BTC
By 25 November, the volume of CME ETH Futures had risen even further, and the ETH annualized basis, which represents the premium hedge funds receive when purchasing U.S. spot ETH ETFs and shorting ETH Futures, also saw an increase.
This upward trend has surpassed the BTC pattern post-U.S. elections, as highlighted by David Han, a research analyst at Coinbase. Han remarked,
“CME ETH basis has recently expanded beyond BTC as well after trailing behind it for the past several months.”
While the surge in institutional interest could have a positive impact on ETH’s price, hedge funds’ hedging strategies may expose the asset to volatile price fluctuations accelerated by liquidations.
Moreover, the growing momentum of ETH against BTC is evident in the ETHBTC ratio, which measures the altcoin’s performance relative to BTC.
Over the past seven days, there has been increased interest in ETH, with the ETHBTC ratio recording a nearly 15% surge.
Consequently, ETH has outperformed BTC in recent days, particularly during the latest downturn experienced by BTC.
However, for this trend to be sustainable, the ETHBTC ratio must convincingly rise above the 50-day Simple Moving Average (SMA).
Considering the false breakout witnessed in early November, resulting in ETH underperforming subsequently, the question arises: will the current scenario differ as the ETHBTC ratio flirts with the 50-day MA?
As of the latest update, ETH was priced at $3.4K, marking a 4% increase in the past 24 hours, with immediate targets set at $3500 and $3600.