Ethereum (ETH) Stays in the Limelight
On February 12th, the price of Ethereum (ETH) reached a peak of $2,633, coming close to its highest point in 2024. Meanwhile, Bitcoin (BTC) surpassed the $50,000 mark for the first time since 2022, attracting significant media attention. While BTC has taken the spotlight, Ethereum bulls are strategically positioning themselves for a similar breakout. The question remains: will ETH price reclaim $3,000 in the near future?
The increase in bullish bets by Ethereum derivative traders suggests a positive outlook for ETH. Over the years, the price movements of Ethereum and Bitcoin have been closely correlated, leading to optimism that BTC’s milestone of $50,000 on February 12th could pave the way for a bullish upswing in ETH.
In the ETH derivatives market, there has been a noticeable surge in leveraged bullish bets by speculative traders. The funding rate, represented by CryptoQuant’s aggregate percentage of fees paid by perpetual futures traders to maintain their positions, has risen to 0.4% on February 13th. This indicates that traders are placing more leveraged bets on an imminent price increase in ETH. Notably, this is the highest funding rate in over 40 days, dating back to January 8th when investors were accumulating bullish positions ahead of the Bitcoin spot ETF verdict.
Currently, ETH is trading just below the $2,660 mark, signaling an overwhelming bullish sentiment following BTC’s crossing of the $50,000 milestone. This surge in ETH funding rates suggests that an Ethereum price rally towards $3,000 could be on the horizon.
Institutional investors in the US have intensified their efforts to secure an ETH spot ETF approval in the first half of 2024. On February 12th, Frank Templeton became the latest asset manager to file ETH derivative applications with the US Securities and Exchange Commission (SEC). These institutional participants are supporting their optimism with rapid ETH purchases in the spot markets. The Coinbase Premium index, which tracks the intra-day difference in Ethereum prices on Coinbase Pro and Binance, has consistently shown positive values since February 8th. This suggests that buying pressure from whales on Coinbase Pro has exceeded retail activity on Binance. This pattern has historically foreshadowed major ETH price rallies, and it comes as no surprise that ETH has gained 11% since the whales increased their buying pressure on February 8th.
Considering the bullish sentiment among speculative traders and the buying pressure from US-based whales, it is likely that ETH price will continue its upward trajectory. Historical patterns associated with these bullish metrics suggest that Ethereum price could reach its next milestone target at $3,000. However, the bulls may face a significant resistance level at $2,750, as indicated by IntoTheBlock’s in/out of the money data. If this resistance is overcome, it could generate the momentum needed to push for the $3,000 target.
On the other hand, a bearish scenario could emerge if the bears manage to push the price of ETH below $2,000. However, this seems unlikely in the short term. The chart provided by IntoTheBlock shows that there are 3 million holders who have acquired 6.2 million ETH at an average price of $2,300. If these holders defend their positions, ETH will find solid short-term support around the $2,350 level.
In summary, the combination of rising funding rates and buying pressure from US-based whales suggests an upward trajectory for ETH price. Based on historical patterns, Ethereum is likely to make another leg-up towards the $3,000 mark. However, the bulls will face a significant challenge at the $2,750 range. If this resistance is overcome, it could pave the way for a push towards the $3,000 target. Conversely, a bearish scenario could occur if the price drops below $2,000, although this is unlikely in the short term.
