Ethereum price broke a new record today, touching an all-time high of around $3,500. So why did Ethereum rise?
Ethereum’s rise is just the beginning!
Ethereum is one of the best performing digital assets with 10% gains today and 36% gains in the last week.. ETH gained impressive momentum a few hours ago, hitting an all-time high of $3,527.
Ethereum price is a massive 1400% increase since the start of 2021. noted. Over the past few days, Ethereum has delivered incredible profits to its investors.. So why is Ethereum rising?
Is there a short squeeze behind the Ethereum rally?
There may be a big short squeeze behind Ethereum’s last rally, causing a bullish wave .
Short squeeze means short-sold orders in the futures market are liquidated within a short period of time. So here, the bulls push prices up, putting short traders in trouble and pressure to close their positions.
When short positions are liquidated, sellers are forced to repurchase their positions.. This automatically causes an increase in demand from buyers in the market.
Thus, the number of short positions decreases rapidly and long contracts or buy orders begin to dominate the market.
Will return to Ethereum. If we are; In the last 24 hours we have witnessed the highest all-time short liquidations on derivatives exchanges.. According to crypto analytics firm CryptoQuant, liquidations in ETH have reached nearly $55 million, helping the price set a new record. For the first time, the trading volume has surpassed the trading volume of Bitcoin options.
As a result of increased volatility, Ethereum’s market cap has exceeded $ 400 billion. According to CoinGecko, the average daily trading volume has reached approximately $72.7 billion.
According to the chart; Higher support is needed for bulls to aim above $3,500 and $4,000 respectively. The Moving Average Convergence Divergence (MACD) indicator shows that the dominance of Ethereum price is clearly in the bulls.
Demand for Ethereum is increasing!
Ethereum, the second largest digital asset by market cap, has recently received a lot of demand from institutional investors thanks to its superiority in DeFi.
Ethereum is trying to threaten Bitcoin’s dominance over the market. and Ethereum’s market share rose to 16.7%, while the BTC Dominance Index fell to 44.6%.
After a two-week consolidation period, the cryptocurrency market is in a super cycle even though the bulls are resurgent. inside. While the uptrend leaves its place to downside corrections after a while, a loosening begins in the market.. But according to Dan Held, a popular cryptocurrency analyst, the rise will continue in the coming months.
“Central banks are constantly printing money … Bitcoin, fiscal 2008 emerged as an antidote to central banking’s bad monetary policy during the crisis. And it grew with a huge bull run.”
Also the analyst adds:
“The current 4-year micro cycles coincide with macro (10-year) cycles that put Bitcoin in a possible Super Cycle. This is similar to Ray Dalio’s observation of short- and long-term debt cycles, but here the process is faster. “
Yes, it is only natural that a project like Ethereum should have a much larger share in such a pie.. Indeed, for the decentralized finance network, the Ethereum ecosystem is considered the pioneer of the smart contract market.. DeFi networks, such as Uniswap DEX, are based on the Ethereum ecosystem and handle most of the day-to-day cryptocurrency transactions.
Chainlink co-founder Sergey Nazarov is also among those who praise Ethereum:
“Thousands of developers are developing applications that decentralize traditional financial products on the Ethereum network, and more and more users interact with these applications every day.. And so, they need ETH to execute any transaction.”
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