Ethereum has fallen nearly 14% from its June high and dropped below several long-term trend indicators, leaving the market focused on whether support near $1,600 can withstand mounting derivatives exposure.

Santiment data showed Ethereum is approaching a milestone of 200 million non-empty wallets, while CryptoQuant data pointed to record futures positioning on Binance. 

Yet despite those signs of network activity, ETH continues to trade near its weakest levels of the year.

At around $1,616 on June 11, Ethereum was down 3.14% over 24 hours and 13.82% over the past week. 

The token's market capitalization stood near $195 billion, with daily trading volume reaching about $13.1 billion.

The decline has pushed ETH into a technically important area after losing roughly 66% from its cycle high near $4,800 and about 14% from its June peak around $1,890.

Recent price action has placed Ethereum under pressure across both the daily and weekly timeframes.

Weekly chart data shows ETH trading below its 100 week, 200 week and 300 week exponential moving averages, which currently sit near $2,704, $2,522 and $2,245. 

ETH/USD 1-week price chart. Source: TradingView.

Losing all three levels leaves a large resistance zone overhead and highlights how much ground buyers would need to recover before restoring a stronger long-term structure.

Equally important, the breakdown below the 300-week EMA has removed one of the last major trend supports visible on the higher timeframe chart.

Order flow indicators continue to favor sellers.

Weekly cumulative volume delta remains negative, showing that aggressive selling activity has continued to outweigh buying pressure despite several relief rallies over recent months.

On the daily chart, Ethereum is attempting to stabilize around the $1,600 region after a steep decline from the $2,400 area reached in May. 

ETH/USD 1-day price chart. Source: TradingView.

Recent buy signals have appeared near the $1,550 to $1,600 area, but the rebound has remained limited, which suggests dip buyers have not yet generated enough strength to reverse the downtrend.

The daily open interest long-short indicator also points to pressure from derivatives positioning. 

The latest readings show short-side open interest around 83.3 million compared with long-side open interest near 43.7 million, leaving bearish positioning almost twice as large as bullish positioning on the indicator. 

At the same time, both series have trended lower since earlier in the year, which shows participation has weakened while price continued to fall.

Volume imbalance on the daily chart appears muted at the latest candle, with no strong positive imbalance visible alongside the price bounce. 

Without a clear imbalance in favor of buyers, ETH’s attempt to defend $1,600 remains fragile.

A recovery above $1,680 would be the first sign of short-term relief, followed by $1,750 and then the former June high near $1,890. 

Failure to hold $1,600 would weaken the setup and bring $1,500 back into focus.

While the charts remain under pressure, derivatives activity has continued to expand.

CryptoQuant analyst Darkfost reported that Binance has reached a new all-time high in Ethereum open interest measured in ETH terms, with nearly 3.7 million ETH now tied to futures contracts. 

The analyst also noted that Binance's share of total Ethereum open interest has climbed above 44%.

At the same time, the exchange's weekly average taker buy-sell ratio improved from 0.95 to 1.0.

According to Darkfost, that suggests selling pressure has eased, although the data does not yet indicate that buyers have taken control.

More evidence of speculative activity came from CryptoQuant analyst Arab Chain, who reported that Binance's ETH perpetual-to-spot volume imbalance has risen to roughly 0.90. 

The analyst added that the 30-day moving average Z-score has reached approximately 2.53, placing the metric well above recent norms.

Data cited by Arab Chain showed perpetual contract volume near 5.57 million units compared with roughly 290,000 units in spot volume.

Such a disparity indicates that leveraged traders are contributing more to current price discovery than spot market participants.

A market driven heavily by futures activity can become vulnerable to sudden liquidations if positions begin to unwind, particularly when the price is sitting near a major support level.

Away from price action, Ethereum's network continues to grow.

Santiment reported that the blockchain now holds nearly 195 million non-empty wallets, around 230% more than Bitcoin's 59 million. 

According to the analytics firm, Ethereum is only about 5 million addresses away from reaching the 200 million milestone.

The firm attributed the growth to continued activity across staking, decentralized finance and other on-chain applications.

Meanwhile, CryptoQuant contributor DustyBC said Ethereum exchange reserves have fallen to their lowest level on record. 

Lower exchange balances reduce the amount of ETH readily available for sale if demand improves.

However, the declining reserves have not been enough to offset weakness elsewhere in the market.

Another downside scenario came from analyst Ali Charts, who highlighted Alphractal's Delta Price model. 

According to the analyst, the metric currently sits near $700, a level that coincided with Ethereum's previous major cycle bottoms.

The post Ethereum price warning grows as $1,600 support comes under pressure appeared first on Invezz

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