Ethereum (ETH) price rapidly climbed 3% to hit $1,650 on September 28 after Bloomberg Analyst Eric Balchunas hinted that the SEC could approve an Ethereum Futures ETF on Friday. How will Ethereum spot market prices react?
News of an imminent Ethereum ETF approval has triggered an influx of capital in ETH Derivatives markets. How high can Ethereum prices go if the market projections hold true?
Ethereum Open Interest Hits 40-day Peak After $450m Capital Inflows
Ethereum price rallied 3% on September 28 after Bloomberg ETF analyst Eric Balchunas hinted at a possible Futures ETF approval via Twitter (X.) Ethereum derivatives traders reacted positively to the news.
As depicted below, aggregate ETH Open Interest stood at $4.16 billion on September 27. Within 24 hours of the news, that figure had ballooned to $4.51 billion.
This means that investors have added $450 million in inflows to the ETH Futures market in anticipation that the US Securities and Exchange Commission (SEC) will approve an ETH ETF on Friday.
Open Interest is the total of all outstanding derivatives contracts for an asset across various Futures trading platforms. An uptrend in Open Interest is a bullish signal indicating an influx of new market participants and fresh capital inflows.
If the SEC approves the ETH Futures ETF as anticipated, the Ethereum Open Interest could grow even further in the coming weeks. However, this has to translate into spot market demand for ETH price to enter a corresponding price rally.
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The Bullish Sentiments is Spreading to the Spot Markets
The recent news has undoubtedly boosted confidence in the Ethereum derivatives markets. However, on-chain data pulled from 21 crypto exchanges shows that investors have also been piling up orders in the spot markets.
As shown below, the bulls have placed active orders to buy 500,000 ETH. And this is considerably higher than the 3 million tokens higher than the 433,670 ETH currently up for sale.
The Exchange On-chain Market Depth chart shows the volume of active ETH spot orders placed across recognized crypto exchanges.
As seen above, the market demand for Ethereum has outstripped supply by more than 66,330 ETH. This suggests that the Futures ETF approval rumors have also buoyed confidence among retail market participants.
In conclusion, the ETH price could gain significantly if Eric Balchunas’ ETH approval speculation holds true.
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ETH Price Prediction: Potential Rally Toward $2,500
Based on the key data points analyzed above, ETH price could reclaim $2,500 if ETF approval does trigger the anticipated spot market reaction.
The Global In/Out of Money Around Price (GIOM) data, which depicts the entry price distribution of current ETH holders, also supports this bullish prediction.
It shows that if ETH clears the $1,850 resistance, the bulls could ride the wave toward $2,500. As shown below, the 6.88 million addresses bought 8.38 million ETH coins at an average price of $1,850. If they book profits early, that sell-wall could form a major obstacle.
But if the derivatives market speculators intensify the buying pressure, the Ethereum price rally could edge toward $2,500.
Conversely, the bears could invalidate the positive prediction if the Ethereum price drops below $1,500. However, as shown above, 3.28 million addresses had bought 6.69 million ETH at the minimum price of $1,587.
If the bullish sentiment remains dominant they will likely prevent the bearish downswing.
But if the ETH price fails to hold that support level, it could open the door to a reversal below $1,500.
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