- Ethereum Name Service (ENS) is experiencing a significant rally, fueled by ETH surge past $3,100.
- Derivatives data shows strong bullish sentiment, with Open Interest (OI) jumping nearly 50% and a high long/short ratio.
- On-chain data indicates reduced selling pressure, as ENS supply on exchanges hits a record low.
- Technical indicators suggest further upside potential, with ENS targeting the $30 resistance level and beyond.
- However, the Relative Strength Index (RSI) indicates overbought conditions, warranting caution for potential pullbacks.
Ethereum Name Service (ENS) Soars: Bullish Momentum Targets $30 Amid Ethereum Rally
The cryptocurrency market is abuzz as Ethereum (ETH) stages a remarkable comeback, surging past the $3,100 mark. This renewed bullish sentiment in the Ethereum ecosystem is providing a significant tailwind for associated projects, with the Ethereum Name Service (ENS) leading the charge. ENS, an innovative identity layer built on ETH, has witnessed a remarkable double-digit increase in the last 24 hours, outpacing the broader crypto market and signaling a growing demand within the burgeoning Web3 space.
Also Read: Ethereum Price Squeeze: Will ETH Break Out Above $2,470 or Dip Below $2,424?
Derivatives Market Signals Intense Trader Interest
The recent price action in ENS is not merely a speculative spike; it’s backed by robust data from the derivatives market. CoinGlass data reveals a 48% surge in ENS Open Interest (OI) over the past 24 hours, pushing it to an impressive $131.58 million. Open Interest signifies the total number of outstanding derivative contracts that have not yet been settled. A significant increase in OI, particularly when accompanied by rising prices, indicates a substantial inflow of capital into the derivatives market, reflecting heightened interest and conviction from traders.
Further supporting this bullish narrative is a noticeable spike in the OI-weighted funding rate, which climbed from 0.0028% to 0.0149% in the last 8 hours. A positive funding rate means that long position holders are paying short position holders, suggesting a prevailing bullish sentiment where more traders are betting on price increases. This dynamic often indicates that buyers are willing to pay a premium for leveraged long exposure.
Moreover, a massive shakeout of short positions amounting to $599.40K, significantly outweighing the $119.27K in long liquidations, points to a market where bearish bets are being squeezed out. This reinforces the idea that bulls are firmly in control. The long/short ratio further solidifies this, standing at 1.0121. A ratio above 1 implies a greater number of active long positions compared to short positions, underscoring the dominance of bullish sentiment among active traders.
On-Chain Data Reveals Dwindling Selling Pressure
Beyond the derivatives market, on-chain data provides another compelling reason for ENS’s upward trajectory. Santiment data indicates that the ENS supply on exchanges has plummeted to a record low of 4.99 million tokens, a level not seen since November 14th. In the world of cryptocurrency, a declining supply on exchanges is a powerful bullish signal. It suggests that fewer tokens are readily available for sale, which, when coupled with increasing demand, can create a scarcity-driven price appreciation. Investors are moving their ENS tokens off exchanges, likely into cold storage or for long-term holding and participation in the ENS ecosystem, reducing immediate selling pressure. This aligns perfectly with the fundamental economic principle of supply and demand: limited supply meeting rising demand inevitably pushes prices upward.
Ethereum Name Service (ENS) Targets $30 Breakout
The technical outlook for ENS paints an equally optimistic picture. The token is currently printing its fourth consecutive bullish candle on the daily chart, a strong indicator of sustained buying momentum. It has successfully reclaimed the $26 level, a price point last seen five months ago, marking a significant recovery. So far in July, ENS has already seen a 41% increase, setting a clear target for the $30.29 resistance level, which was last tested on February 3rd.
A decisive daily close above this crucial $30.29 resistance could pave the way for a further uptrend, potentially pushing the price towards $34.51 (last tested on February 1st) and eventually challenging its year-to-date high of $38.57.
Also Read: Ethereum Price Prediction: Bulls Eye $2,400 as Whales Accumulate in April 2025
Adding to the bullish confluence of technical indicators, the 50-day Exponential Moving Average (EMA) is on the verge of crossing above the 100-day EMA. This formation, often referred to as a “golden cross,” is a widely recognized buy signal, indicating that short-term price momentum is gaining strength and surpassing the medium-term trend.
The Moving Average Convergence/Divergence (MACD) further confirms the bullish sentiment, with both the MACD line and its signal line rising higher in positive territory. The increasing height of the histogram bars above the zero line suggests growing bullish momentum.
However, it’s crucial to acknowledge the Relative Strength Index (RSI), which currently reads 78 on the daily chart. This indicates that ENS is in overbought conditions, suggesting that the price may have risen too quickly and could be due for a minor pullback or consolidation in the short term. While overbought conditions don’t necessarily signal an immediate reversal, they warrant caution. If ENS fails to maintain its current momentum, a bearish turnaround could lead to a retest of the $24.88 level, which was the daily close on February 9th.
A Promising Horizon for ENS
The confluence of strong fundamentals, bullish derivatives data, dwindling on-chain supply, and positive technical indicators points to a very promising outlook for ETH Name Service. As the Web3 ecosystem continues to expand and the demand for decentralized identity solutions grows, ENS is well-positioned to capitalize on this trend. While the overbought RSI suggests a potential for short-term consolidation, the overall market sentiment and underlying metrics indicate that the bulls are firmly in control, with the $30 target firmly in their sights and higher levels potentially achievable in the coming weeks.
