According to data from one of the worlds largest crypto exchange ‘Bitfinex’,the amountof short orders placed on ETH/USD, the 2nd largest digital currency bymarket capitalisation, surpassed thepreviousbenchmark of 202,854 to ultimately reacha newhigh of 208,689.
The new data figure representsmore than 80 percentincrease this week and a 162%jump since mid-aug.
The development followsafter anunfavourable week for the broader digital currency market and Ethereumparticularly. The price of Ethereum fell from around $289.3 USD to $$220 USD following this week.
All around, the developments mark atotal of more than 80%drop in the price of Ethereum comparing it to a all time high price of around $1200 USD,thusit’smaybeno surprise thatpeople’sconfidence in the digital currency seem to be fading at present times.
However, when short positionsarestacked higher,a lowincrease in the valuemaycause those shortingto shut positionsso asto avoid a losing trade. Sincethe only method toshuta short tradeisto shopback the digital currency, it’s even possible thatEthereummaysee acertain price hike,conjointlyreferred to asa “squeeze.”
Looking atthe informationfroma specialangle, its possible that onemaycreatean argument that short and long market conditionsarea lot ofalmost alike theNovemberandDecember in 2017.
Whilethe conceptofa shortsqueezeis reassuring bulls, but it’snevera guarantee –and also thelack of technical support levels below ETH/USD hasdefinitelyprovidedbenefitfor the overcrowded trade.