- Ethereum rises above $3,500, boosted by Bitcoin boom and U.S. demand, facing possible corrections.
- Rising settlements and bullish leverage highlight volatility and risk; investors should exercise caution.
Ethereum has recently surpassed the $3,500 barrier, an achievement not seen since 2021, driven by several factors such as the rising price of Bitcoin, higher funding rates, and growing demand in the U.S., especially on Coinbase, as we have previously mentioned on ETHNews.
However, this has been accompanied by an increase in bullish leveraged positions and bearish on-chain metrics signals, pointing to the possibility of a near-term correction.
The cryptocurrency market has experienced a wave of liquidations, with over $750 million in total and close to $120 million in Ethereum alone, indicating high volatility and risk. This surge in liquidations highlights the danger of excessive optimism in the market.
The cost of bullish leveraged positions has increased, and a drop in the price of ETH to $3,200 has boosted this risk, putting the sustainability of these positions in check .
In addition, the current funding rate of ETH suggests potential long-term unsustainability, with increasing selling pressure due to the exit of short-term holders from the market.
Despite facing resistance at the $3,500 level and warnings of a possible correction, Ethereum has shown resilience, holding above the 20-day exponential moving average, offering a glimmer of hope.
However, investors should proceed with caution, balancing optimism with cautious market vigilance, as Ethereum navigates these troubled waters towards possible new horizons.
Ethereum (ETH) is currently in an intriguing phase of its evolution, trading at $3512.6 USD, marking an increase of $23.2 or 0.66% in the last few hours .
