The price of Ethereum (ETH) has experienced a significant 21% decline in the past month, but there are signs that a potential rebound could be on the horizon as optimism among buyers starts to emerge.
Currently, ETH is showing a 0.49% decrease at the time of writing. The recent surge in trading volume in the derivatives market, coupled with increased buying activity from investors in Korea and the U.S., may act as catalysts for a revival in ETH’s value in the coming days.
Institutional Investors Capitalizing on Profits
Recent insights from Glassnode suggest that there has been a gradual shift in sentiment among traditional institutional holders of ETH.
Between the 10th and 15th of February, there was a negative turn in the Ethereum spot ETF, resulting in the sale of approximately 14,000 ETH, valued at around $37.7 million based on the current price of $2,695.
The selling activity could be attributed to profit-taking by institutional investors who had previously engaged in bullish trading leading up to the beginning of February, a level that had not been witnessed since December.
Should this pattern persist, it is likely that traditional investors will resume buying ETH with the start of the new trading week.
Enthusiasm from Korean and U.S. Retail Investors
While institutional investors were selling off ETH, retail investors from Korea and the U.S. continued to show interest in purchasing the digital asset, a trend reflected in their respective indexes.
Korean retail investors have maintained a positive stance towards ETH, with the Korea Premium Index steadfastly above zero since mid-December, reaching a notable 4.7 at the current juncture.
The Korea Premium Index tracks the buying and selling activities on Korean exchanges relative to other global platforms. A positive figure signals bullish sentiment, while a negative reading indicates a bearish market outlook.
Similarly, U.S. retail investors have been steadily accumulating ETH, albeit in smaller quantities, a trend mirrored in the Coinbase Premium Index, standing at 0.02 at present.
If the buying momentum from both retail investor segments persists, it is likely to bolster the overall bullish sentiment surrounding ETH, potentially driving prices upwards.
Growing Interest Among Derivatives Traders
Derivatives traders have been actively participating in the market, with a noticeable increase in buying activities. The Taker Buy-Sell Ratio, a measure of buy volume against sell volume, currently stands at 1.033, indicating a greater influx of buyers.
A ratio above 1 indicates heightened buying pressure from derivatives traders.
This sentiment is further supported by the positive shift in the Funding Rate, settling at 0.0090 at the time of reporting.
A positive Funding Rate suggests a dominance of buyers willing to pay a premium to maintain market imbalances in perpetual and swap exchanges.