- Ethereum’s funding rate signals a potential rebound for ETH.
- ETH has declined by 16.48% over the past 7 days.
Since hitting $4109, Ethereum [ETH] has experienced strong downward pressure. As such, over the past week, the altcoin has declined to a low of $3095 dropping by 16.48%.
Despite the recent dip, Ethereum seems positioned for a comeback to $3,300. This is because Ethereum’s funding rate has cooled since facing two rejections at $4k.
Ethereum’s Futures market cools after $4k rejection
According to Cryptoquant, Ethereum’s failure to reclaim the $4k resistance resulted in massive liquidations in the futures markets.
Source: Cryptoquant
This resulted in a huge market crash with ETH hitting lows. While ETH’s funding rate surged last week, the altcoin’s failure to hold above $4k brought the funding rate back to healthy levels. These levels are well suitable for a bullish trend.
Therefore, the cooling effect from this could potentially pave the way for a more sustainable rally in the coming weeks.
Historically, such a pattern occurred in January 2024 when the drop in funding rates cooled the futures market strengthening ETH for a major uptrend.
During this rally, Ethereum rallied from $2169 to $4091. This historical precedent indicates that the current market reset could mark the beginning of another bullish phase.
What ETH charts suggest
While Ethereum has experienced strong downward pressure over the past week, the prevailing market conditions point towards recovery.
