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Since the beginning of February, the price of Ethereum (ETH) has been fluctuating in a relatively narrow range, oscillating back and forth between key support and resistance levels. Despite the sideways price trend, traders in the futures market have shown strong confidence and continued to increase their purchases of contracts, showing optimism about ETH’s future upside potential.
Futures Market Resilient: Buying Force Strengthens
Looking at the ETH/USD one-day chart, the leading altcoin has been stuck in a horizontal channel since the beginning of the month, with the upper resistance at $2,799 and the lower support at $2,585. However, despite the limited price fluctuations, ETH futures traders remain bullish and have gradually increased their buy orders.
An important bullish signal comes from Ethereum’s Taker-Buy-Sell Ratio. According to CryptoQuant, this indicator has now climbed to 1.09, the highest level since early January.
What is Taker-Buy-Sell Ratio?
This indicator measures the ratio of buying volume to selling volume in the futures market. When the value is above 1, it indicates that buying volume exceeds selling volume, while below 1, it means that more traders are selling their positions. ETH’s ratio is currently 1.09, reflecting futures traders’ optimism about ETH’s future performance, even though its price has been lackluster over the past few weeks.
In addition, ETH’s **Funding Rate** has also remained in the positive range, currently at 0.0051%.
The significance of funding rate
The funding rate is a fee paid regularly between longs and shorts in the futures market, based on the difference between the spot price of an asset and the futures price. When the funding rate is positive, it indicates that long traders are willing to pay a premium to shorts, usually reflecting a bullish market sentiment.
In the current price consolidation phase, the positive funding rate further indicates that investors are willing to pay a premium to hold long-term long positions, and expect ETH to usher in a wave of rising prices after breaking through the consolidation range.
Key resistance: Breaking through $2,799 may open upside
If ETH can successfully break through the key resistance of $2,799, the price may quickly climb to $2,967. If demand further strengthens at this price, ETH is even expected to challenge the $3,000 mark and may continue to rise to $3,202.
However, if the bears regain dominance and push the price below the support level of $2,585, ETH may quickly fall back to $2,467. If the bulls fail to hold this line, the downward trend may continue to $2,150.
Summary: Short-term volatility, long-term potential
Although Ethereum’s recent price performance is slightly dull, data from the futures market sends positive signals. Whether it is the increase in the Taker-Buy-Sell Ratio or the positive funding rate, it shows that investors are confident in the future of ETH.
For bulls, a breakout above $2,799 would be a critical step that could open the door to $3,000 for ETH. However, investors also need to be wary of potential downside risks, especially if support levels are breached.
In short, the current sideways movement could be the calm before the storm. Both short-term traders and long-term holders need to keep a close eye on ETH’s price dynamics and seize potential opportunities while managing risks.
