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A recent analysis by CryptoQuant points to growing optimism among Ethereum traders, as reflected in positive funding rates in the futures market.
Positive funding rates, a key metric that shows the balance of demand between buyers and sellers, suggest that market sentiment is bullish for Ethereum.
According to analysts, Ethereum’s funding rate is currently showing a steady upward trend. Positive funding rates indicate that traders in the futures market are increasingly inclined to invest in Ethereum’s price appreciation, and that there is increasing confidence in ETH’s near-term potential. However, despite this renewed optimism, analysts believe that funding rates have yet to reach the levels seen in early March, when Ethereum experienced a significant bullish rally.
According to CryptoQuant, this gap suggests that while enthusiasm for ETH’s prospects is growing, it has yet to reach the level needed for a major breakout.
For Ethereum to break out of the current resistance levels and secure a sustained uptrend, analysts suggest that funding rates need to rise further. Higher funding rates could signal a stronger willingness among traders to go long, potentially increasing buying pressure on Ethereum and fueling a more sustained rally.
A continued increase in positive funding rates will likely be a precursor to a stronger uptrend and reinforce bullish sentiment in the futures market, the CryptoQuant analyst said.
*This is not investment advice.