The price of the second-largest cryptocurrency by market capitalization is on the verge of a ‘death cross’—a harbinger of bearish momentum.
This signal occurs when the 50 DMA crosses below the 200 DMA.
On February 25, Ethereum’s price fell to $2325, with the ‘fast’ moving average nearing a crossover with the lower ‘slow’ counterpart.
Hedging Against Decline
Bearish sentiment prevails in the Ethereum perpetual contracts market.
Derivative trader Gordon Grant told The Block that this is linked to fears of coin sales by hackers who stole $1.4 billion by altering the smart contract logic of one of Bybit exchange’s cold Ethereum wallets.
The expert noted a shift in demand from calls to puts in upcoming derivatives.
QCP Capital reached similar conclusions, noting prevailing pessimism until expirations at the end of March. Specialists calculated that the hackers who breached Bybit became the 14th largest Ethereum holders.
A similar pattern is observed in Bitcoin perpetual contracts.
According to Coinglass, amid a price drop to year-to-date lows, open interest on Binance increased by 12,000 BTC in a day, indicating a rise in short positions, according to CoinDesk.
Further support for the bearish scenario comes from the continued decline of the cumulative volume delta (CVD) into negative territory, signaling sales exceeding purchases.
Meanwhile, CryptoQuant recorded a transfer of 24,630 BTC to hodler wallets—addresses associated with OTC platforms that accumulate coins for long-term storage.
Amid a sharper decline in altcoins, Bitcoin’s dominance index surged to its highest since March 2021.
CryptoRank noted the impact of disputes within the Ethereum Foundation and the fallout from meme coin scandals on Solana on the prices of major competitors to the leading cryptocurrency.
Bitfinex has described the current Bitcoin correction as ‘critical.’
Earlier, CryptoQuant warned of the threat of digital gold entering a bearish phase.
Prior to this, CoinDesk identified three risks to the first cryptocurrency losing its $90,000 level.