ETH is experiencing a surge in leverage trades following the volatility and demand slowdown since early February. A contrast to its performance in January, but recent observations suggest an increased risk of liquidations which may bring about a surge in volatility.Is your portfolio green?
Check out the Ethereum Profit CalculatorA recent CryptoQuant analysis looked into the potential for the Ethereum futures market being overheated.
The analysis was based on the observed surge in the demand for leverage among futures market participants.The uptick in leveraged trades reflects the lower demand in the market, hence the lower enthusiasm in price action.Source: CryptoQuantA surge in demand for leverage is often associated with a higher risk of longs or shorts liquidations.
A volatility surge usually accompanies a large liquidation due to the subsequent short squeeze or long squeeze. But is ETH currently headed for such a scenario?ETH long and short liquidations might reveal some interesting insights about the state of demand.On the other hand, ETH shorts liquidations dropped since the start of March while longs liquidations experienced a surge.Read more on ambcrypto.com