Based on the data presented, the average investor is not confident that Ethereum (ETH) will be bullish even though the asset recorded a jump of almost 200% in the first quarter of 2021.
At the same time, institutional flows are weakening especially for Ether derivatives. CoinShares revealed the Ether fund posted a record outflow of $ 50 million last week.
Perhaps the London hard fork and EIP-1559 scheduled for July will boost ETH prices. But in June, the asset failed to move positively when compared to Bitcoin (BTC), a gap of 16% despite a broadcast announcement last February.
More worrying is that Ether’s premium futures for December showed a record below 4%-8%. Worse, it failed to be driven by a 3.5% increase in December BTC futures.
For a healthy market, quarterly futures should be traded at a premium exchange up to normal. In addition to exchange risk, traders ‘lock in’ funds by postponing settlement. Due to that the premium of 4% to 8% for December contracts is enough to offset the effect.
Even if the futures fail to trade within that range, it indicates short -term bearish sentiment.
Not only that, a 30% decline in Bitcoin in the future will probably lead to a double -digit collapse in the price of altcoins.
While not sure how far Bitcoin will decline, ADVFN chief financial analytics executive Clem Chambers predicts Bitcoin will plummet to $ 20,000.