Ethereum Classic (ETC) has recently experienced a significant downturn, shedding nearly 9% of its value in a sharp decline. This price action underscores a prevailing bearish sentiment in the market, driven by critical shifts in derivatives data and a complex long-term price structure that offers both immediate caution and potential for short-term relief.
Bearish Pressure Dominates Derivatives Market
The recent cascade in ETC's price can largely be attributed to a noticeable contraction in liquidity and an overwhelming bias towards short sellers in the perpetual market. Approximately 9% of liquidity exited, leaving open interest at roughly $90.12 million, predominantly aligned with bearish positions. A deeply negative Open Interest–Weighted Funding Rate of -0.0282—one of its steepest readings since October 2025—confirms that short traders are actively paying long traders, signaling strong conviction and a willingness to maintain their downside bets. Further evidence lies in liquidation data, where long positions absorbed the brunt of recent losses, leaving short sellers comparatively insulated and highlighting their firm control over current price dynamics.
Nuanced Price Structure and Future Outlook
While derivatives heavily favor bears, ETC's price structure presents a more complex picture across different timeframes. On the daily chart, ETC trades within a descending channel. While typically bearish, a decisive close above its upper resistance boundary could precede a bullish breakout. The critical level to watch for a short-term recovery is $9.94. However, the broader monthly timeframe paints a more cautious, long-term outlook, with ETC trending lower within a large consolidation pattern. The price has already broken below key support, nearing a lower structural level. A failure to hold this zone could push ETC to new all-time lows, though a rebound remains viable if this crucial support holds.
Glimmer of Short-Term Rebound?
Despite the pervasive bearish sentiment, momentum indicators suggest a potential for temporary relief in the near term. The Moving Average Convergence Divergence (MACD) shows its blue line trending upward towards the orange signal line, accompanied by increasingly intense green bars on the histogram, indicating strengthening bullish momentum. Similarly, the Aroon Indicator reflects improving upside pressure, with the Aroon Up remaining above the Aroon Down. These signals point to the possibility of a short-term rebound in the coming sessions. Nevertheless, the broader bearish structure remains firmly intact unless ETC can reclaim and sustain levels above the $9.94 resistance, urging investors to remain cautious regarding the persistent downside risks.
