Ethena's ENA token jumped 41% on the daily chart, breaking out of a multi-month descending channel to hit a seven-month high. The rally liquidated $4.2 million in short positions and pulled in fresh spot demand, though stretched indicators point to possible near-term cooling.
Ethena's ENA reclaimed $0.10 and touched $0.144, a seven-month high, before easing to trade near $0.132. The move came amid a broader market recovery that pushed the altcoin out of a descending channel it had traded in for months.
Short sellers pay the price
Trading volume for ENA jumped 267% to $363 million over the same period. Market capitalization also rose 40% to $1.2 billion, reflecting stronger market activity and fresh capital entering ENA. The rally triggered a short squeeze that forced bearish traders from the market, and CoinGlass data showed the rebound liquidated $4.2 million worth of short positions.
Some traders likely covered their positions, while others may have flipped long as ENA continued rising, a scramble that strengthened buying pressure and fed further liquidations. Derivatives volume rose 269% as traders opened additional positions during the rally. Open interest also climbed 67% to $390 million. The long/short ratio reached 1.04, a slight preference for long positions.
Whales pull ENA off exchanges
As futures traders exited short positions, spot investors and whales accumulated ENA. CoinGlass data showed spot netflow stood at -$2.3 million, compared with -$4.4 million the previous day, after remaining negative for two consecutive days. The negative reading indicated more ENA left exchanges than entered them, reducing immediately available supply.
According to vxDrophunter, one whale withdrew 5.822 million ENA from Bybit, a withdrawal during an uptrend that suggested confidence in ENA's market prospects. Historically, strong demand has supported ENA's price, though the latest rally had already stretched momentum considerably.
Can ENA hold above $0.13?
Buyers dominated the market as the Bulls v Bears indicator reached a yearly high of 100, showing overwhelming bullish control. The relative strength index supported that reading after entering overbought territory.
Both indicators favor trend continuation, but overbought conditions could also raise the risk of a short-term pullback. If demand holds, ENA could reclaim $0.17 before attempting a move above $0.20.
Source: AMBCrypto
Trading involves risk.
Risk Disclaimer
