Ethereum is experiencing a strong rally, reaching significant price levels, but signs of exhaustion among bulls are beginning to emerge. This article examines the current state of ETH and possible scenarios for its future movement.
Technical Analysis
On the daily chart, ETH remains in a strong uptrend, trading well above both the 100 and 200-day moving averages, located around the $2,500 mark. The recent breakout from the $2,800 area has triggered a clean rally, with the price now hovering around $3,660 after briefly hitting $3,800.
The RSI peaked above 78, indicating that the move was heavily overbought. However, it has since begun to cool down. A key level to monitor is the $3,300 area, which could act as support after being a breakout zone. As long as ETH holds above that level, the macro structure remains bullish.
Nonetheless, the asset is stalling just below the $4,000 resistance level, with the latest daily candles showing upper wicks, indicating selling pressure. If the bulls fail to push beyond $3,800, a deeper pullback to the $3,300 range may occur, which could represent a healthy retest before further continuation.
On-Chain Analysis
From a sentiment standpoint, Ethereum's recent rally has been supported by growing speculative interest, as reflected in the rising funding rates across all major exchanges. Funding has turned positive and continues to climb, indicating that long positions are becoming more dominant as traders chase the breakout. However, it’s important to note that despite this uptick, funding rates are still far from the extreme highs seen at major market tops in the past.
During previous cycle peaks, funding spiked aggressively, reaching levels that typically precede sharp corrections or long squeezes. Currently, funding remains relatively moderate, suggesting that although sentiment is turning more bullish, it’s not yet at a euphoric stage. This gives Ethereum some breathing room for further upside continuation, provided that rates don’t escalate too quickly. Traders should monitor funding dynamics closely, as a sudden surge could serve as an early warning of overheating conditions.
Conclusions and Forecasts
Ethereum is in an uncertain state. While the rally has led to significant price growth, signs of exhaustion and potential correction scenarios raise concerns among traders. Monitoring key support and resistance levels is crucial to understanding further trends. Remember that the cryptocurrency market remains volatile, with changes possible at any moment.
The current state of the Ethereum market presents mixed signals. The success of further growth will depend on the asset's ability to maintain above key levels and favorable market conditions.
