Domain Name Service Cools Down, Earning Profit From Selling Pressure Of $ENS

Domain Name Service Cools Down, Earning Profit From Selling Pressure Of $ENS

The domain name service of Ethereum has emerged as a new trend in June and July of this year. The peak was recorded as the price of ENS had a momentum x2.5 times from the bottom when going from $7 to more than $18 within 1 month. However, after a while of silence. Under pressure of the general downtrend of the market. Tokens of typical domain name services, ENS, are under a lot of selling pressure. Let's find opportunities to profit from ENS selling pressure with Holdstation through this article!

Business situation

Source: The Data Nerd

First of all, looking at the new open data and renewal of ENS domains (data collected by The Data Nerd), we see a very clear downward trend year-to-date. Until the latest week, the number of new purchases was 11.2K and renewals were 3K, nearly divided by 10 from the peak of May and September of this year.

Source: The Data Nerd

Looking at the transaction data on the DEX (data collected by The Data Nerd), we see that there was a large amount of ENS sold from October 17 to November 7 (negative Net Flow, meaning more selling than buying and vice versa). In the past 2 weeks, that trend has been maintained, showing that the interest from the community has not returned.

Source: The Data Nerd

Going to the management aspect of ENS DAO, although the number of votes increased quite strongly in April 2022, the percentage of participation has continuously decreased significantly, which shows that users are not too interested in the proposals of the DAO, especially especially during periods of market volatility. The number of people who voted in August was only 104 votes.
Overview of ENS's business situation, in general, it is facing many difficulties when ENS itself is under the pressure of the general downtrend of the market. which use. The price of the "older brother" ETH also did not have many positive changes, which also caused the price of "the whole ETH family" to decrease.

Shark Tracking

According to data from The Data Nerd, the specific situation of sharks, on December 7, a Dex Trader wallet pushed all 310K ENS ($4.3M) onto Coinbase. This wallet has been held for more than 1 year, from November 2021, but bought strongly from November 21 (price zone $12.3). However, 5 days ago this wallet also transferred a large amount of ENS about 312.5 thousand tokens to the wallet: 0x9A209EC1D143f5b4B2acAE4ab19C58624388eCfB and this wallet immediately transferred all these tokens to Coinbase (price area $13.6). It is very likely that this is a sign of profit taking from this big wallet (data collected by The Data Nerd).

Shark 1: 0x6eb0685d5d17eda3045f8a1aa04061ed1290a30f

Another wallet with similar behavior, tag Dex Trader, when collected from Coinbase for nearly 1 year, then on 11/21 also pushed all 150K ENS back to the exchange. This wallet has just gathered strongly since 11/21 (price zone $12). However, 5 days ago, this wallet transferred a large amount of about 171 thousand ENS to the wallet address: 0x9350eeD2bD398e4dfBaF4358EC2Eb4db96f8d93b and immediately moved this token to Coinbase (price area $13.6). And similar to the shark above, this is very likely a profit-taking signal of this large wallet.

Shark 2: 0xf3d699aa69ffbc6f0b505bed83a3cc9d0d9fd35b

Turning to the "eldest brother" ETH, the 90D Coin Days Destroyed (CDD-90) index is trending up again. This indicator shows that long-term ETH holders are inclined to accept ETH transactions at a loss. History records that when this index increases, the price of ETH will decrease. The decrease of ETH price will contribute significantly to the decrease in ENS price.

How to earn profit from the ENS

In my personal opinion, it is very likely that the price of ENS will continue to decrease when the business results and onchain data are not supporting the uptrend for the price of ENS.

Investors can use derivatives such as leveraged trading or put options to profit from the falling price of ENS. I personally think that ENS will return to the $10 price zone in the short to medium term to retest the support zone. When the weekly chart ENS is supporting the downtrend

The information, statements and conjecture contained in this article, including opinions expressed, are based on information sources that Holdstation believes those are reliable. The opinions expressed in this article are personal opinions expressed after careful consideration and based on the best information we have at the writing's time. This article is not and should not be explained as an offer or solicitation to buy/sell any tokens/NFTs.
Holdstation is not responsible for any direct or indirect losses arising from the use of this article content.
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