Ethereum (ETH) may be nearing the end of its price correction, as the second-largest cryptocurrency by market cap continues to trade slightly above $4,000, following a strong sell-off last week when it almost crashed to $3,400.<\/p>\n
According to a CryptoQuant Quicktake post by contributor PelinayPA, Ethereum funding rates on Binance crypto exchange have remained positive, despite being in a narrow range. This shows that long positions on ETH still dominate the market.<\/p>\n
ETH funding rates fluctuating<\/a> normally on Binance \u2013 despite the digital asset\u2019s recent extraordinary price appreciation \u2013 implies that futures traders are not exhibiting greed or euphoria, typically associated with the mid-phase of a healthy uptrend.<\/p>\n For example, during the 2021-22 bull cycle, ETH funding rates often surged to 0.1% to 0.2%, aligning with local market tops. At present, these funding rates are hovering around 0.01% to 0.03%, implying that the market has not reached overheated levels just yet.<\/p>\n In addition, the absence of negative funding rates confirms a decline in short positioning, and elevated risk appetite among investors. The CryptoQuant analyst added:<\/p>\n The overall trend remains upward. Low funding rates combined with strong price momentum suggest that the correction is likely complete. In the short term, minor profit-taking or sideways consolidation between $3,600\u2013$3,800 would be natural. If funding rates gradually rise above 0.05%, it could signal overcrowded longs and trigger a short term pullback.<\/p>\n The current combination of moderate levels of leverage and gradually rising spot demand hints toward a potential ETH rally, eyeing the $4,500 to $5,000 range in the long term. The price target could be even higher with a favorable derivatives structure and funding dynamics.<\/p>\n That said, a sharp increase in funding rates could be seen as an early warning of another price pullback for the cryptocurrency. However, ETH\u2019s market structure still supports a potential surge to $6,800 by the end of 2025, the analyst concluded.<\/p>\n Several indicators point toward ETH looking to resume its bullish momentum. For instance, ETH\u2019s Spent Output Profit Ratio (SOPR) trend recently hinted<\/a> toward the digital asset rising to $5,000 in the near term.<\/p>\n Further, ETH exchange reserves continue to tumble at a rapid pace. Recent exchange data shows<\/a> that ETH reserves on exchanges have hit a multi-year low, raising the possibility of an impending \u201csupply crunch\u201d for the cryptocurrency.<\/p>\nETH Ready For New Highs?<\/h2>\n