Ethereum
Ethereum DEX volume loses $2 billion in 7 days: bad news for ETH?
- DEX volume fell to $1.03 billion, but indicators revealed that ETH price could rise.
- Liquidation levels suggest that the altcoin may leave more short positions in liquidations.
Activity on Ethereum [ETH] Decentralized exchanges have been down for seven days, AMBCrypto confirmed. As of May 28, according to Messari data, the volume stood at $3.34 billion.
However, press the time data watch that DEX volume had fallen to $1.03 billion – a decrease of $2.21 billion. An increase in DEX volume would have meant more liquidity for Ethereum.
Since its fall, this means that on-chain transactions involving ETH were no longer as numerous as they were last week. Another interpretation indicates a decrease in demand for the altcoin.
Source: Messari
A “slight” fall is not the end
With declining demand, ETH may struggle to see a significant price increase. At press time, the ETH price was at $3,763, representing a 3.50% decline over the past week.
The disappointing price action is one reason why some participants share the view that Ethereum may not represent a significant part of the bull market.
However, AMBCrypto felt that the opinion was not factual. It was because of the signals indicated by the market value to realized value (MVRV) Z-score. MVRV has a strong correlation with price.
As a result, it indicates when a cryptocurrency is in a bearish or bullish phase. If the score is negative, it means that the asset is in a bearish phase. According to the chart below, the last time ETH was in such a state was in October 2023, which means that the token had entered the bullish phase.
At press time, the MVRV Z score was 1.63. A look at peak of previous bull cycles as in 2017 and 2021, this showed that the metric had reached. 14.19 and 4.76 respectively. If the pattern were to repeat itself, it would mean that the price of Ethereum could climb higher.
Source: Santiment
But it is for the long term. In the short term, AMBCrypto analyzed liquidation levels. The liquidation level is the price at which an exchange forcefully closes a trader’s position.
Watch out for bears! ETH looks ready to recover
The reason behind this is to avoid further losses. At press time, large-scale Ethereum liquidations could occur between $3,882 and $3,946. This implied that the price could move towards the mentioned region.
We also checked the cumulative liquidation level delta (CLLD). A positive value of this reading implies that there are longer liquidations. A negative reading suggests that liquidations were domination.
Source: Hyblock
Read Ethereum [ETH] Price prediction 2024-2025
Looking at the chart, CLLD was negative and short liquidations over the past seven days exceeded $59 million.
But when it comes to price, negative CLLD is bullish for ETH as a late sell-off might fail to make up for the decline. In this case, ETH could recover and the projection at $3,946 could come true.