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ethereum, the second-largest cryptocurrency by market cap, has yet to recover the $3,000 price level since early August. Since the beginning of September, ethereum has mostly traded below $2,600, but this week brought a ray of hope to investors as it finally managed to break the $2,600 threshold.
Now that this resistance threshold has been surpassed, the next perspective There is a continuous rise until the $3,000 price level. An analysis by the CryptoQuant platform points to a possible catalyst for this bullish movement. In particular, this analysis identifies an emerging bullish trend in ethereum funding rates as a critical catalyst.
Upward change in financing rates
According to a Analysis of eth on CryptoQuant According to ShayanBTC, the 30-day moving average of ethereum funding rates has seen a slight but notable bullish shift after a long period of decline. This change suggests that traders are once again increasingly confident ethereum price behavior, particularly after the recent interest rate cut by the Federal Reserve.
eth funding fees refer to periodic payments made between traders to keep the price of perpetual futures contracts close to the spot price of the cryptocurrency. When funding rates change positively, it often indicates that long positions are more dominant, which can create upward pressure on prices.
The analyst highlighted the importance of the types of financing, especially taking into account the perspective of a bullish fourth quarter of the year. In particular, they echoed that for ethereum to continue its recovery and aim for higher price levels, demand in the perpetual futures market must continue to increase in the coming weeks. A small drop in funding rates could lead to a drop in bullish momentum.
Is ethereum Preparing a Return to $3,000?
ethereum's recent breakout above $2,600 is the first sign of a major shift in market sentiment. After weeks of trading below, the $2,600 price level appears to have now become an essential support zone for the cryptocurrency. Interestingly, this breakout sets the stage for eth's return to $3,000, with funding rates playing an essential role.
At the time of writing, ethereum is trading at $2,610 and is up 8% over the last seven days. Notably, this price increase is most notable from a low of $2,171 on September 6, reflecting a 20% increase since then.
The positive sentiment surrounding ethereum is also moving towards institutional investors, which is reflected ethereum-and-bitcoin-etfs-struggle-in-hong-kong/” rel=”nofollow”>via ethereum Spot ETF. According to the flow data, the ETFs, which initially started the week with a net outflow of $79.3 million on Monday, have now witnessed two consecutive days of $62.5 million and $43.2 million , respectively, on Tuesday and Wednesday. The combination of these entries could play a major role in whether ethereum can break through the $3,000 price level and stay above it in the coming weeks.
Featured image created with Dall.E, chart from Tradingview.com
