Ethereum reclaimed the $3,150 level after a volatile Sunday session that left traders divided on what’s next. Some analysts are warning that ETH’s recent rally is nothing more than a temporary pause before the downtrend resumes, while others see signs of a potential bullish reversal forming at current levels.
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New data from Binance reveals that Ethereum is now entering a delicate phase. Price momentum has clearly weakened, but open interest remains relatively high despite the decline from the $3,900 region. This disconnect highlights a major shift in futures market behavior: traders are holding on to their positions, but not aggressively adding to them.
The 30-day Open Interest Z-Score currently sits at 0.50, indicating that OI is just slightly above its 30-day average, well within normal volatility bands. Unlike previous corrections, where open interest surged during sell-offs, the current reading suggests neither extreme leverage accumulation nor panic-driven position closures.
This unusual combination – weakening momentum coupled with stable open interest – highlights a market in transition. Whether Ethereum resumes its downtrend or begins to recover will depend on how quickly momentum returns to the spot and futures markets in the coming days.
Stability in open interest rates signals a repositioning market
According to Arab Chain’s report on CryptoQuant, Ethereum’s $6.61 billion in open interest highlights that traders still hold a substantial portion of their positions despite the sharp decline from $3,900 to below $3,200. This divergence – falling prices but stable OI – is characteristic of market repositioning phases, during which traders reduce their activity without completely leaving the market.
Supporting metrics reinforce this view: OI avg30 stands at $6.44 billion and OI std30 at $329 million, indicating that current fluctuations remain well within normal volatility ranges. There are no signs of aggressive position accumulation or liquidation pressure.
With the Z-Score at 0.50, the modest rise in open interest does not suggest overwhelming bearish leverage. Instead, it shows that traders continue to engage with the market and selectively build new positions as prices decline. This level of participation is important: it signals that the derivatives market is active but not overheated.
Ethereum’s price weakness, caused by fading momentum after failing to maintain previous highs, leaves the market at an inflection point. If large traders are primarily short, stable OI could support continued downward pressure. However, if long positions dominate, this same stability could lay the foundation for a rebound once momentum returns.
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Testing momentum as bulls attempt to regain control
Ethereum is attempting to stabilize above the $3,150-$3,160 zone after a volatile multi-week decline. The chart shows ETH rebounding from a local low near $2,750, forming a short-term ascending pattern. However, the dynamic remains fragile. The 50-day SMA continues to decline and is well above the current price action, reinforcing the broader downtrend. Until ETH can break through and close above this moving average, upward attempts will likely be met with resistance.
The 100-day SMA is also falling, converging towards the $3,350-$3,400 region, an area that could provide the next major ceiling for any bullish continuation. Meanwhile, the 200-day SMA remains stable but sits just above the price, creating an additional barrier between $3,250 and $3,300. This group of resistance levels confirms that Ethereum is still operating in a corrective structure despite the recent rebound.
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Volume decreased significantly compared to the strong sales increases seen in November. This suggests that the rebound may be more due to a decrease in selling pressure than strong spot demand. If volume remains low, ETH may struggle to build enough momentum for a sustainable recovery.
Featured image from ChatGPT, chart from TradingView.com
