Ethereum has seen a slight decline over the past week, dropping about 5% after a significant growth period in previous months. At the time of writing, ETH is trading around $3,633, fluctuating between $3,500 and $3,700 over the past day.

This price volatility follows a general market cooldown, with many traders participating in profit-taking after Ethereum's previous upward trend. Recent derivatives and on-chain market data suggest that Ethereum may be heading into a consolidation phase.

Derivatives Market Data Signals Selling Pressure

CryptoQuant analyst Darkfost shared a perspective indicating increasing selling pressure and potential short-term weakness in the ETH futures market.

The analyst highlights that despite numerous attempts to break the $4,000 resistance level, Ethereum has yet to succeed, indicating that the market may be hesitant at the current level.

Darkfost emphasizes that futures market behavior has changed significantly over the past few weeks. According to data from Binance, the buy/sell ratio of Ethereum has dropped to 0.87, one of the lowest recorded this year.

A ratio below 1 often indicates that sell orders are dominating buy orders, suggesting that traders are closing long positions or opening short positions. Analysts note that this trend began around July 18 and has predominantly remained negative since then, limiting the upward momentum.

Additionally, the 7-day and 30-day simple moving averages (SMA) have begun to trend downward, which may be a sign that the market's growth momentum is slowing.

Binance continues to hold the largest open ETH futures positions among exchanges, making sentiment on this platform particularly influential. With sellers currently exerting tighter control over the market, data suggests that this consolidation phase may continue until buying activity strengthens.

Contrary View on Ethereum's Long-Term Prospects

Although short-term market data suggests Ethereum is undergoing a challenging phase, some analysts remain optimistic about the long term. A recent post by Titan of Crypto, a widely followed market commentator on X, predicted a potential price target of $8,000.

According to Titan of Crypto, the price structure of Ethereum is forming a large monthly triangle pattern, which could eventually lead to a breakout, paving the way for a significant price increase.

This optimistic outlook aligns with other bullish forecasts about X, where traders speculate that Ethereum could rebound or surpass its previous all-time high as key resistance levels are breached and broader market demand returns.

However, currently, the lack of strong futures buying activity and ongoing selling pressure in the derivatives market seem to be limiting short-term gains. $ETH