ETH futures data reflects traders’ fear, while onchain data points to a price recovery

Key takeaways:

• Ether’s futures premium and derivatives remain stable, reflecting resilience despite the recent price downturn.
• Onchain metrics highlight Ethereum’s dominance in fees and TVL, supporting stronger long-term recovery potential.

Ether (ETH) appears to have found support near $4,070 on Wednesday after a sharp six-day, 15.1% drop. The move erased $817 million in bullish leveraged positions but failed to trigger a broad bearish shift. Instead, ETH derivatives show traders remain unfazed by additional downside, suggesting $4,700 remains within reach

ETH 6-month futures annualized premium. Source: laevitas.chETH’s annualized futures premium stayed above the neutral 5% threshold throughout the decline, signaling confidence. Monthly futures typically trade higher than spot markets to reflect the longer settlement period, yet the last meaningful bullish signal from this metric came in January. Even the 100% ETH rally between July 1 and Aug. 13 could not fully restore trader optimism.

Economic uncertainty dents investor sentiment

Part of this hesitation stems from macroeconomic uncertainty. US inflation remains stuck above the Federal Reserve’s 2% goal, while economic growth shows uneven signals. The Nasdaq Composite fell for a second straight session on Wednesday, pressured by concerns that artificial intelligence stocks may be excessively valued.

CNBC reported traders trimmed positions ahead of US Federal Reserve Chair Jerome Powell’s Friday remarks. “If Powell’s language is more hawkish, that could pressure tech stocks even further,” noted Carol Schleif, chief market strategist at BMO Private Wealth. Meanwhile, retailer Target’s weaker earnings underscored stress on profitability.

ETH 30-day options delta skew (put-call) at Deribit. Source: laevitas.chContrary to expectations, ETH options suggest a neutral stance, with balanced demand for both downside and upside protection. The current 4% reading indicates an even split between put (sell) and call (buy) interest. Still, the absence of stronger optimism after ETH briefly traded above $4,700 is somewhat troubling, as it signals hesitation toward calling a new all-time high.

Ethereum onchain activity signals higher demand for ETH

Onchain activity paints a more constructive picture. Ethereum continues to expand its dominance over competitors, securing roughly 60% of the market’s total value locked (TVL), according to DefiLlama. Even more relevant, network fees are climbing, reflecting stronger demand for blockspace, which supports Ether’s price recovery.

Top blockchains ranked by 7-day fees, USD. Source: NansenEthereum’s 7-day fees climbed to $11.2 million on Wednesday, a 38% increase from the prior week. For comparison, Solana’s fees rose just 3% while BNB Chain revenues declined by 3%. This divergence highlights Ethereum’s dominance in decentralized exchange volumes, which reached $129.7 billion over the past 30 days, according to DefiLlama.

Related: Bitcoin, Ether ETFs post almost $1B outflows as prices slide

While Ether derivatives still suggest caution, that stance reflects the broader crypto market correction rather than Ethereum’s fundamentals. Traders appear wary that US import tariffs could weigh on global growth, pushing investors toward risk aversion.

Ultimately, ETH’s path to reclaiming $4,700 hinges on a decline in investors’ fear about the economy. Still, derivatives data indicate professional traders remain composed, showing no signs of panic even after the $4,100 retest, supporting the case that Ether’s recovery rests on firmer ground than many initially assumed.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

• #Cryptocurrencies
• #Federal Reserve
• #Ethereum
• #Economy
• #Markets
• #Fees
• #Interest Rate
• #Futures
• #Market Analysis
• #DEX
• #Nansen Add reaction