Since the fake rally, derivatives markets have seen an increase in Ethereum(ETH) open interest, while Bitcoin(BTC) is witnessing a sharp drop in its OI.The positive sentiment that hit a five-month peak, if sustained, would suggest increased bullishness for ETH.
Ethereum gains traders' interest
Ethereum, since the beginning of October, has been maintaining a distant following to Bitcoin in the derivatives market. The total open interest (OI) for BTC is averaging around $6 billion, while in the case of ETH, the same is $2.8 billion.
According to Santiment, while ETH did not take over BTC in terms of open interest, it did eclipse Bitcoin in terms of interest. Bitcoin's OI has declined by more than $270 million to touch $5.7 billion following the recent BTC fake-out rally triggered by the false news of an approved spot Bitcoin ETF.
But that translated into good news for Ethereum as it gained some of the lost interest in Bitcoin. The OI in the case of ETH increased by more than $93 million, coming up to $2.8 billion.
Bitcoin and Ethereum Open Interest, Souce:Santiment.
This situation was also observed back in September towards the end of the month when BTC OI dropped, and Ethereum OI rose. This resulted in an increase in Bitcoin price, which shot up by more than 4.5% in the span of 24 hours. Should history repeat itself, BTC could see some increase or sustained sideways movement around the current trading price of $28,310.
Ethereum needs investors' support
While Ethereum may be the traders' favorite asset, it still needs to ensure sustained support from the rest of the ETH holders. According to the weighted sentiment, the optimism surrounding ETH has been declining since the beginning of the month, averaging borderline pessimism.
Ethereum weighted sentiment, Souce:Santiment.
This is also evident in the active addresses noted on the network. Recently the ETH holders that have been conducting transactions on-chain have been averaging under 380,000 on a daily basis, noting a slight decline from the average of 400,000 in August.
Ethereum active addresses, Souce:Santiment.
Improvement in these regards would also suggest an improvement in the interest of investors in Ethereum, which would support a potential recovery for the asset, pushing it back above $1,600.
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