Ethereum / Breaking News / Analytics
Ethereum (ETH) dominance has now declined to new lows. This is a very bearish event for the altcoin market in general and Ethereum (ETH) in particular. If we take a look at the daily chart for Ethereum Dominance (ETH.D), we can see that it plunged to new lows yesterday. It ended up closing the day by bouncing up significantly but now it has begun another day in the red. This is quite interesting to see at a time when 80.3% of traders are long and 19.7% traders are short on Ethereum (ETH) at the moment. This is an even bigger divide than we see in the case of Bitcoin (BTC). It also points to the fact that a lot of retail traders are still very comfortable investing in altcoins in anticipation of the next bull run.
Needless to say, this has never ended well for the retail trader as such optimism is always exploited by the market makers and whales. If we were to look at this from the market maker’s perspective, they have to put a stop to this otherwise they would be out of business. Think about this, if 80% of the total margined longs were allowed to be right, then exchanges would be out of business because they would have to pay massive payouts to these traders. This is why it rarely happens and the most likely scenario as always is that most of these overly optimistic traders are shaken out as the price crashes hard and begins its downtrend. Pumping the price takes time because people have to buy into the FOMO and actually believe that there is potential for the price to go up,