Futures market data suggests Ethereum (ETH) could rally soon – CryptoQuant

A CryptoQuant analyst says Ether (ETH) could see a rally soon, as shown by cryptocurrency futures market metrics.

According to a post by analyst Shayan, ETH has just witnessed a major liquidation event, and historically such events are often followed by price rallies as markets stabilize and spot buying pressure takes over.

ETH could recover soon

Earlier this month, the price of ETH went on a downward trajectory, causing the crypto asset to lose nearly 34% of its value. Ether fell from $3,329 to $2,197, according to data from CoinGecko.

The drop led to investor speculation about whether the cryptocurrency would fall further; however, significant buying activity near the $2,100 region saw the asset rally slightly to the $2,500 level, where it currently stands. At the time of writing, ETH was changing hands at $2,623, down 2.3% in the last 24 hours.

While Ether has seen some recovery, data from the futures market suggests that the asset could see a more significant rally. The recent decline led to a massive liquidation of perpetual long positions, which reached a level last seen in November 2022. Shayan said the liquidation indicates that the futures market is cooling and that many positions leverages have been removed. This development and increased spot buying pressure may allow renewed interest in the market.

“With the futures market potentially restarting, if demand returns, Ethereum could be poised for another long-term bullish push. The cooling futures market may attract new buyers and stabilize the market, leading to a possible recovery from the recent recession,” Shayan added.

ETH Price Outlook

While Shayan’s analysis suggests a bullish reversal for ETH, the asset’s daily and hourly charts may indicate otherwise.

Ether has a substantial bullish response near the critical support level of $2,100 and robust demand around $2,000, reflecting investor interest and confidence in its long-term potential. Still, the asset is facing resistance at the $2,800 threshold. This resistance level includes the lower limit of the wedge previously broken during Ether’s fall days ago.

A recent analysis published on CryptoPotato revealed that as ETH continues to regain momentum, the $2,800 level could hinder upward momentum and lead to a reversal of the $2,000 support level.

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