Ethereum (ETH) has been making strides towards hitting a new all-time high (ATH) of $5,000 after facing a setback in August 2025. A recent decline in Binance open interest suggests that ETH may be approaching a local bottom, signaling a potential uptrend in the near future.
Analyzing the Binance ETH open interest (OI) on an hourly timeframe, CryptoQuant contributor burakkesmeci pointed out that local bottoms have historically been accompanied by an average decline of 14.9% over the past three months. These corrections have often led to an average 10.7% drop in the spot market price of ETH.
The correlation between drops in ETH OI and spot price corrections has been evident in recent events. For example, on August 17, a 10.52% decrease in Binance ETH OI preceded a correction in ETH price. Similarly, on August 20, a 25.38% drop in OI foreshadowed a price correction, reinforcing the idea that OI serves as a leading indicator for spot price movements.
Based on the current trends, it is speculated that the Binance ETH OI may decrease further to $9.69 billion, indicating that ETH is nearing a local bottom. However, there is a possibility that the ETH price may experience further decline before finding strong support at the local bottom.
Meanwhile, another CryptoQuant analyst, PelinayPA, highlighted the positive Fund Market Premium (FMP) for ETH between July and September 2025, signaling increased institutional demand for the cryptocurrency. With strong institutional support and positive premiums, ETH is expected to maintain stability above $4,400 and potentially target $6,800 in the near future.
Additionally, the rapid depletion of ETH exchange reserves further supports the bullish outlook for ETH. Recent analysis by Arab Chain also predicts ETH to touch $5,500 by September, indicating a positive trajectory for the cryptocurrency.
Despite the optimistic projections, there is a slight pause in ETH’s rally at the moment. As of the latest data, ETH is trading at $4,491, showing a 0.8% increase in the past 24 hours. However, with the supportive market indicators and institutional demand, ETH is poised for further upside potential in the coming days.
In conclusion, Ethereum’s journey towards a new ATH is gaining momentum, with key market indicators pointing towards a potential uptrend. As the cryptocurrency market continues to evolve, ETH remains a promising asset for investors looking to capitalize on its growth potential.