Ethereum Name Service (ENS) – the decentralized naming platform operating on the Ethereum (ETH) blockchain – recorded an increase of over 8% at the time of writing on Wednesday, outperforming the overall recovery of the cryptocurrency market with a double-digit increase in the past 24 hours.
The impressive return of ETH above $3,100 has acted as a catalyst, driving the strong growth of ENS – an integral part of the rapidly growing Ethereum ecosystem.
In addition, data from both the derivatives and on-chain markets show a clear optimistic sentiment. Open interest (OI) has surged while the amount of ENS on exchanges continues to decline – a signal indicating that investors are expecting a sustainable price increase in the near future.
ENS open interest has increased by nearly 50%
According to data from CoinGlass, the open interest (OI) of ENS has surged by 48% in just 24 hours, reaching $131.58 million. This strong increase reflects new capital flowing into the derivatives market, indicating growing interest from traders towards the ENS token.
Notably, the funding rate has also jumped from 0.0028% to 0.0149% in the last 8 hours. This is a clear signal of bullish sentiment, as they are willing to pay fees to maintain long positions, in order to narrow the gap between the price in the swap market and the spot market.
At the same time, the bears are under significant pressure as the total value of short positions liquidated in the past 24 hours reached $599,400 – many times higher than the $119,270 from the longs. The long/short ratio currently stands at 1.0121, indicating that the number of long orders is slightly higher and further reinforces the bullish sentiment in the market.
The ENS supply on exchanges has hit a record low
According to data from Santiment, the amount of ENS tokens circulating on exchanges has dropped to only 4.99 million – the lowest level since November 14. This trend indicates that the supply is gradually depleting. In the context of increasing demand, the law of supply and demand suggests that this trend may continue to drive ENS's price increase.
ENS aims for the $30 mark thanks to strong upward momentum
On the daily timeframe, the Ethereum Name Service (ENS) just closed its fourth consecutive green candle on Wednesday, officially reclaiming the $26 mark after more than five months below this level. The strong recovery from early July to now has helped ENS increase by 41%, approaching the important resistance area at $30.29 – a price that was last tested on February 3.
If ENS can firmly close above this resistance area, the uptrend may continue, with the next targets being $34.51 – the peak price on February 1, and then the highest level since the beginning of the year at $38.57.
Technical signals are supporting the bulls. The 50-day exponential moving average (EMA) is trending upward and is about to cross above the 100-day EMA – a 'bullish cross' pattern often seen by analysts as a confirmation signal for an uptrend.
The MACD indicator also supports the uptrend as the MACD line and the signal line are expanding in the positive zone, while the histogram bars exceed 0, indicating that bullish momentum is being solidly reinforced.
Additionally, the relative strength index (RSI) is currently at 78 – in the overbought zone, reflecting that demand is clearly dominating.
However, if the current momentum is not maintained, ENS could very well reverse and adjust to the nearest support area at $24.88 – corresponding to the closing level established on February 9.
