The market is experiencing a cooldown following its recent weekly highs. On the daily timeframe, a majority of the leading cryptocurrencies are experiencing a pullback. Following a robust rally at the beginning of the week, numerous assets have successfully reclaimed significant levels, marking a notable shift after nearly eight weeks of stagnant movement. In that context, the “dip” seems to resemble a reset rather than an authentic weakness. Ethereum certainly follows suit. From a technical perspective, ETH has seen a decline of 3% from its weekly peak of $3.4k. Despite the pullback, it’s important to note that it’s up 7% from the open, indicating that the broader weekly structure remains intact.
In the derivatives market, speculative liquidity is on the rise, with almost $3 billion injected into ETH’s Open Interest just this week. Meanwhile, on Binance, the ETH/USDT perpetual contract has seen an average long skew of 60%. When considering Ethereum’s price action, a distinct tension emerges between technical strength and speculative bets. As macro volatility takes center stage, the upcoming FOMC meeting is just around the corner, less than two weeks away. In light of the current market conditions, one must ask: is ETH’s 3% pullback merely a dip, or could it signal the beginning of a larger unwind? In the present market landscape, remaining on the sidelines appears to be a prudent strategy.
However, Ethereum is making a notable impression. reports shows a notable increase in activity retention for the “New” cohort, indicating a surge in first-time interacting addresses. Additionally, new wallets have reached an unprecedented milestone of 393k. This naturally prompts an inquiry: What is drawing in all these new wallets, particularly in the face of persistent market FUD and ETH’s technical divergences? Interestingly, the response appears to be rooted in the robust fundamentals of the Ethereum network. According to the chart, Ethereum’s daily transactions have reached an all-time high. In context, the network recorded 2.8 million transactions on January 15th, marking a significant 55% increase from the previous week. This figure represents more than double the usual activity, underscoring increased engagement and robust confidence in the network.
Alongside the increase in wallets, ETH’s fundamentals are demonstrating resilience. Increased transactions signify an active network, whereas a rise in wallets suggests new capital is flowing into the system. This momentum serves as a crucial support for price, providing Ethereum with a competitive advantage even in the face of market FUD. Despite a 3% pullback from weekly highs, Ethereum continues to show resilience, remaining up 7% from the open, bolstered by its technical structure and increasing speculative interest. Record daily transactions and a surge in new wallets underscore the increasing network activity and investor confidence, offering technical support in the face of market FUD.