April 16 saw the largest Ethereum (ETH) derivative exchange inflow in months. Over 77,000 ETH flowed in, a volume not registered since early March. The flow occurred in tandem with that of March 26 and April 3, both of which predated significant price declines.
Traders frequently roll assets to derivative exchanges to hedge or establish short positions. Previous spikes in ETH netflow have always been followed by precipitous price plunges in Ethereum.
The most recent occasion follows this trend. At the time of writing, ETH is trading at approximately $1,589, a multi-month low.
With repeated spikes in inflow and decreasing prices, the trend becomes more obvious. The big players might be setting themselves up for more downside.
The steep netflow rise, combined with poor market conditions, is indicative of bearish tendencies. Most in the market interpret this as another hedge before more downside.
Geopolitical factors weigh heavily on this week’s crypto activity. On April 15, China hit back at the U.S. with new tariffs.
The measures target key imports, including U.S. technology and agricultural products. This move is in response to U.S. trade curbs on semiconductors and electric vehicles.
Ethereum diverges in short-term performance
Investors globally reacted with circumspection. Global risk assets, including cryptocurrency, came under pressure. In situations of increasing tension among major economies, money tends to seek safer havens such as U.S. Treasury bonds or the U.S. dollar.
Ethereum, too, has not escaped. Risk-off mood struck at the same time as the huge ETH inflow. The overall macro environment heightens the markets’ precarious condition.
Coupled with on-chain information, it is indicative of diminishing confidence in crypto performance in the short term.
Ethereum is showing a negative momentum and experiencing volatility in its price. However, the Ethereum price has been hit by market volatility and shows a bearish trend in higher timeframes. Its price over the last 24 hours is down by 1.80%, and over the last month it is down by 17.10%.
Nonetheless, currently, ETH is trading at $1590, with a 24-hour trading volume of $12.23B and a market cap of $192.06B. The ETH price decreased by 1.81% in the last 24 hours, showing stability and signs of further upward momentum.
