Ethereum (ETH) traders may be on the verge of seeing a significant price surge, according to crypto analysts. With Ether’s funding rate approaching a key threshold, sentiment could soon shift, potentially setting the stage for a bullish rally.
Ether’s Funding Rate Holds the Key
CryptoQuant analyst Burak Kesmeci highlighted that Ether’s funding rate—currently at around 0.0056%—needs to rise above 0.015% to trigger a major bullish breakout. The funding rate serves as a small fee in the futures market that helps stabilize prices between futures and spot markets. A higher rate often signals increasing market optimism, as traders are more willing to pay premiums to hold long positions.
Kesmeci noted in a September 12 analysis, “We will wait for Ether’s funding rate to rise above 0.015 to see if the calm before the storm breaks.”
Positive Signals Needed for Ether’s Next Parabolic Rise
Ether has experienced similar funding rate-driven rallies in the past. In September 2023, a spike in the funding rate above 0.015% led to a 166% price increase over six months, eventually pushing ETH to $4,006 by March 2024.
Kesmeci emphasized that a rise in the funding rate is crucial for tracking “healthy increases during bull markets,” and further support from the futures market is essential to fuel the next price rally.
Ether Struggles to Break Key Resistance
Despite the potential for a bull run, Ether has faced price stagnation in recent weeks. Since September 2, the cryptocurrency has been unable to break the critical resistance level of $2,500, leaving traders uncertain about short-term gains. Additionally, ETH’s performance has lagged behind Bitcoin, with many market participants hoping for a boost from anticipated spot Ether ETFs.
Data from CoinGlass reveals that if Ether manages to surpass the $2,500 mark, around $576 million in short positions could face liquidation, further accelerating a potential upward price movement.
Ether’s Current Market Standing
Ethereum’s current dominance sits at 14.20%, down from a high of 18% in 2021 when ETH reached its all-time high of $4,810. Despite this, Ether remains a key player in the crypto space, and traders are keeping a close eye on the funding rate as a possible indicator of an upcoming rally.
If the funding rate crosses the 0.015% mark, the market may finally witness the long-awaited parabolic rise in Ether’s price.
