Ethereum’s price is finally showing signs of bullish continuation after reclaiming a key level.
However, there is still work to do for the market to pave its way toward a new all-time high.
Technical Analysis
By Edris Derakhshi (TradingRage)
The Daily Chart
On the daily chart, the price has rebounded from the $3,200 support level and broke $3,500 to the upside. If the asset is able to hold above this area, a rally toward the $4,000 level could be expected in the short term.
With the RSI also showing values above 50%, the momentum is bullish once again, which adds to the probability of this scenario occurring.
The 4-Hour Chart
The 4-hour chart shows a more clear picture of recent price action. However, it also demonstrates a potentially worrying signal. While the market has broken through the $3,500 level with force, the bearish divergence between the recent price highs and the RSI indicator is a signal that should be taken into consideration.
This bearish divergence could lead to at least a pullback and retest of the $3,500 level before any continuation higher in the coming days.
On-Chain Analysis
By Edris Derakhshi (TradingRage)
Ethereum Funding Rates
While Ethereum’s price has been holding above the $3,000 mark over the past few months, many investors were heavily optimistic that the market will create a new all-time high soon. However, this significant optimism has also led to a correction that halted the asset’s uptrend.
This chart presents the Ethereum funding rates metric, which measures whether the buyers or the sellers in the futures market are executing their orders more aggressively. As the chart presents, the funding rates showed extremely high values when the price first approached the $4,000 level. However, the long liquidation cascades occurring afterward have led to a correction and consolidation.
Meanwhile, funding rates have decreased over the last few weeks, indicating that the futures market sentiment has cooled significantly. This could result in a sustainable rally in the coming weeks if sufficient demand is present in the spot market.
