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ENA, an emerging altcoin, has experienced a significant price surge of 17% in the past 24 hours, extending its bullish momentum from the previous week. This impressive climb comes despite the asset still trading down approximately 11.81% from its longer-term highs. Recent analysis by AMBCrypto reveals a fascinating divergence in trader behavior, with derivative traders primarily fueling this latest rally while spot traders and larger investors engage in notable sell-offs.
Derivative Traders Drive Bullish Momentum
The current price appreciation of ENA appears to be heavily influenced by the derivatives market. AMBCrypto’s analysis highlights a substantial increase in demand from derivative traders, with key metrics pointing towards a strong bullish sentiment within this cohort. Open Interest in ENA derivatives has surged by 12.86% to $373.14 million, indicating a significant influx of capital into unsettled contracts. Furthermore, the long-to-short ratio has climbed to 1.0194, signifying that buyers currently dominate trading volumes.
Notably, Binance traders exhibit the strongest buying pressure, with their long-to-short ratio reaching 2.0377. This bullish activity in the derivatives market has even led to the liquidation of $905,890 worth of short positions, further validating the upward price trajectory. Overall volume in the derivatives market has nearly doubled since April 20th, reaching $662.46 million, underscoring the intense buying activity.
Spot Traders and Whales Take Profits
Contrasting the bullish stance of derivative traders, spot traders and large investors, often referred to as “whales,” have been actively selling off their ENA holdings. Data from Coinglass’s Exchange Netflows indicates a net outflow of $2.26 million worth of ENA across exchanges in the past 24 hours, suggesting dominant selling pressure from spot market participants.
This selling trend extends to larger wallets, with these investors offloading 4.18 million ENA, valued at $1.42 million, during the same period. While this selling pressure from both retail and large-scale investors might typically suggest a bearish outlook, the sustained price increase hints that these cohorts are likely capitalizing on recent gains by taking profits.
Strong Fundamentals Underpin ENA’s Rally
Beyond the dynamics of the derivatives market, strong fundamental factors appear to be bolstering ENA‘s price surge. A recent analysis by the ENA team comparing the performance of its yield-bearing synthetic dollar, sUSDe, against established assets like Bitcoin, 3-month T-bills, the S&P 500, and Ethereum has likely instilled greater investor confidence.
The report indicated that sUSDe has outperformed all these asset classes in terms of yield. This compelling performance narrative may be attracting more traders to open long positions, further contributing to the ongoing bullish momentum despite the selling pressure observed in the spot market.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
Also Read: Ethena (ENA) Surges 8% Weekly as Bullish Breakout Toward $0.39 Looms
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
