On February 12, the price of ethereum (eth) hit a high of $2,633, just shy of its 2024 high, while bitcoin (btc) surpassed $50,000 for the first time since 2022.
bitcoin (btc) attracted media attention after breaking the $50,000 barrier on February 12, but ethereum bulls are making strategic moves to achieve a similar breakout.
Will eth price regain $3,000 in the coming days?
ethereum derivatives traders have stepped up bullish bets
The price action of ethereum and bitcoin has been closely correlated for many years. This has sparked optimism that btc reaching the $50,000 milestone on February 12 could open the doors for eth to make a similar bullish rally.
In the eth derivatives markets, there has been a notable increase in the rush of speculative traders placing leveraged bullish bets.
CryptoQuant's funding rate represents the aggregate percentage of fees paid by perpetual futures traders to keep their positions open.
The chart below shows that the eth funding rate rose to 0.4% on February 13, indicating that speculative traders are making more leveraged bets on an imminent eth price rise.
Notably, this is its highest level in over 40 days, since January 8, when investors were accumulating bullish positions ahead of the bitcoin spot ETF verdict.
Simply put, rising values of positive funding rates indicate that long position holders are paying higher commissions to short traders in anticipation of an imminent price increase leading to outsized profits.
eth is trading just below the $2,660 mark, at the time of writing on February 13. Therefore, this surge in eth funding rates just after btc crossed the $50,000 milestone indicates an overwhelming bullish outlook that an ethereum price rally towards $3,000 could soon follow.
American whales are increasing their eth purchases
US-based corporate entities have further stepped up their efforts to obtain approval for an eth spot ETF in the first half of 2024. On February 12, Frank Templeton became the latest asset manager in file eth derivative applications with the US Securities and Exchange Commission (SEC).
It appears that institutional participants are backing their optimism with rapid purchases of eth in the spot markets. Cryptoquant's Coinbase Premium Index tracks the intraday difference in ethereum prices quoted on Coinbase Pro Exchange and Binance.
As shown below, the ethereum Coinbase Premium Index stood at 0.04 on February 13 and has been trending in positive values since February 8. And during that
This critical metric is based on the premise that Binance dominates the retail trading market, the majority of Coinbase's professional clientele is dominated by US-based corporations and high net worth investors looking to trade within a more regulated.
Therefore, the positive Coinbase Premium index values mean that eth quoted prices on Coinbase have been consistently higher than those on Binance, indicating that whale buying pressure on Coinbase Pro has outpaced retail activity in Binance.
This pattern has often appeared in the build-up to major eth price rallies. Unsurprisingly, eth price has gained 11% since whales increased buying pressure on February 8.
Combined with the prevailing bullish sentiment among speculative traders, this unusual buying trend observed among whales could send eth price to its next target of $3,000.
eth Price Forecast: $3,000 Target in Focus
In short, speculative traders showing optimism with rising funding rates and buying pressure from US-based whales have put the price of eth on an upward trajectory.
And based on the historical patterns associated with these bullish metrics, ethereum price is likely to make another jump towards the $3,000 area.
However, the bulls face a major hurdle in the $2,750 range. IntoTheBlock money in/out data shows that 878,100 addresses had acquired 671,830 eth at an average price of $2,760.
If the bulls can scale this initial resistance level, they could build momentum to reach the $3,000 target as predicted.
On the other hand, eth price could enter a negative trend if the bears can force a drop below $2,000. But this scenario seems unlikely in the short term. The chart above shows that 3 million holders purchase 6.2 million eth at the average price of $2,300. If those holders defend their position, eth would like solid short-term support around the $2,350 level.
