Aug 26, 2025

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Ethereum Struggles to Maintain Support as Binance Leverage Hits All-Time High

Ethereum's Current Market Status

Ethereum (ETH) is facing critical price action after a volatile trading week.
After reaching highs above $4,800, ETH dropped sharply, now attempting to stabilize around $4,400.
Bulls aim to defend this support level to prevent further declines; bears warn of potential downside if it fails.

Leverage Risks in the Derivatives Market

Analyst Darkfost has noted rising risks in the derivatives market due to an all-time high Estimated Leverage Ratio (ELR) of 0.53 on Binance.
This indicates traders are utilizing extreme leverage, raising concerns about volatility and forced liquidations.
Open Interest on Binance reached $12.6 billion, reflecting high speculative activity.

Market Implications

Excessive leverage may lead to significant price swings, especially if liquidation events occur.
A potential drop below $4,400 could see ETH decline toward the 100-day moving average at $4,350 or the 200-day average near $4,090.
While bulls remain optimistic about retesting $5,000, caution is warranted due to current market conditions.

Technical Analysis Overview

ETH currently trades around $4,426, close to a crucial support zone defined by the 50-day moving average.
Holding above $4,400 is essential for bullish momentum; failure may trigger deeper corrections.