Ethereum Hints an Explosive Downside Movement, Data Shows

Ethereum (ETH) has been carefully watching the price action of Bitcoin (BTC) within the previous days and weeks. As a result, this has made ETH to once again go about of sideways trading in the mid-$130 region.

Even though it can post a strong rebound from its recent lows, it is also essential to remember that analysts are widely anticipating ETH to show intense downwards movements in the near-term.

Also, this comes in tandem with some slight growth in the cryptocurrency’s open interest in BitMEX. And this might be a hint that the next move of the crypto will be massive.

In addition to that, Ethereum is trading up just below 1% at its latest price of $133. This marks a little drop from its daily highs of more than $135 but a notable recovery from lows of $125.

The said lows were set yesterday in tandem with Bitcoin’s fall to $5,800. And this is with bull’s ardent defence of this level, making an upward tailwind that has let virtually all major altcoins into a rally.

Then, in the near-term, it does not look like the mid-$130 region has become resistance to Ethereum. And for it to move past the said level, it might all depend on how Bitcoin trends.

In a recent tweet, one trader stated that ETH is displaying signs of weakness against its BTC trading pair. The trader indicated that it is also recently hovering directly between key support and key resistance.

The tweet said, “Ethereum: The same approach still on ETH/BTC. I’m interested in 0.0172-0.0175 / 0.019-0.01925 areas for support or when we flip the 0.022 area. Right now, it’s just hanging between. Against USDT also not showing strength.”

ETH Futures

Furthermore, two interesting trends that might signal the next movement will be large is the crypto’s plummeting futures volume and rising open interest in BitMEX.

Based on data from Skew, Ethereum’s futures volume around all major cryptocurrency exchanges has dipped significantly in recent times. As a result, it reached a monthly low on March 29 before mounting slightly yesterday.

Japanese Regulations

Meanwhile, a fresh report has found that strict regulations in Japan might benefit new players in the long term.

Now, double jump.tokyo – the game developer behind My Crypto Heroes -, introduced So & Sato, a Japan-based law firm mostly intended for crypto and blockchain.

Last March 31, the law firm showed a report covering every aspect of digital assets in the Asian nation, from tokenized securities to crypto derivatives.

Moreover, So & Sato’s Joerg Schmidt stated in an interview that local regulations for cryptocurrency exchanges are stricter than in most other countries. But, they explained that this could be beneficial in the long run due to the encourages the traditional finance world to get involved.

Then, regulations concerning crypto in Japan mostly fall under the Payment Services Act (PSA) and the Financial Instruments and Exchange Act (FIEA). Subsequently, amendments for both acts tightening existing regulations enter into force in May.

In the new PSA regulations, crypto exchanges need to employ third-party operators to keep hold of their user’s money. Separating it from their cash flow.