Ethereum Futures Market Sees Surge in Buying Activity, Hinting at Price Gains
Ethereums futures market is showing continued signs of a possible bullish shift in the asset, largely due to the high buying activity among traders. According to a CryptoQuant report, the perpetual futures market ranks as one of the most important components determining ETHs price movement. Hence, analysis of the sentiment of futures traders will be crucial for understanding possible price action.
The report points to the importance of ETHs 30-day moving average of funding rates, indicative of whether buyers or sellers are more aggressive in the market. That metric, after weeks of decline, has finally started to show a subtle but noteworthy upward trend. It came with a broader market recovery and an uptick in ETHs price.
Rising funding rates are now considered a signal that more traders are taking positions on price gains, signaling perhaps a more optimistic outlook in the Ethereum market. The increase in the rate indicates that futures traders are becoming bullish, which could drive ETH prices higher if this trend continues.
Ethereum Buying Activity Increases in Futures Market
Nevertheless, the real demand for the futures of the perpetual market of Ethereum should be growing to kick off this positive dynamic and pull its price to higher values. A regular escalation of funding rates will likely uplift the market to higher price levels in the next few months.
This growth would be conceivable only with the continuous support of the futures traders. The opposite effect of funding rates could be a stumble in ETHs redemption.
However, the perpetual futures market demands must continuously spiral upwards to let Ethereum leverage this opportunity and maintain its upswing into even higher prices. Funding rates usually undergo substantial changes due to the sentiment shift in the market, with continuously strong buying activity being the asset driver essential to Ethereums price growth in the medium to long term.
While offering this bullish signal is interpreted as a positive outlook for Ethereum, the market is always uncertain. A strong upward path surely demands the interest of liquidity road participants and institutional investors participation. Thus, the price of Ethereum in the next few weeks could be highly influenced by the traders reactions to these new signals in crypto futures.
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Read more: https://www.tronweekly.com/ethereum-futures-market-sees-surge-price-gains/
Text source: TronWeekly
