Ethereum price continued its uptrend today, Dec. 9, reaching its highest point since Nov. 13, and marking a 30% increase from its lowest level in November.
Key Market Insights
- •Ethereum price has rebounded in the past few days as demand rose.
- •The token is poised to flip the Supertrend indicator from red to green.
- •Ether shorts liquidations surged to over $120 million on Tuesday.
Ethereum (ETH) token soared to a high of $3,380 as the crypto market experienced a bounce back in anticipation of the Federal Reserve interest rate decision, scheduled for Wednesday.
The cryptocurrency's rise coincides with market participants increasing their expectations for an interest rate cut. Data from Polymarket and Kalshi indicates that the odds of a cut have jumped to 95%. Historically, an interest rate cut often leads to heightened demand for riskier assets, including cryptocurrencies and stocks.
Ethereum price also saw a significant increase as short liquidations surged. According to CoinGlass data, these liquidations rose to over $120 million, second only to Bitcoin (BTC), which recorded $160 million in liquidations. Short liquidations occur when leveraged positions decline in value to the point where their collateral is no longer sufficient to meet margin requirements.
Furthermore, Ethereum's funding rate has remained positive over the past few weeks. A positive funding rate signifies that traders holding long positions are paying a fee to short sellers, indicating an expectation of further price increases in the near term.
Ethereum's futures open interest has also bottomed out in recent days, suggesting a potential rebound that could further boost the token's price.
The token's upward movement was also influenced by continued accumulation from entities like BitMine. The company has been actively purchasing Ethereum, acquiring tokens worth over $429 million and increasing its holdings to over $11 billion. BitMine aims to own 5% of the total supply over time. This purchasing activity is occurring concurrently with a continued decline in the supply of ETH held on exchanges, reaching a record low.
Ethereum Price Technical Analysis
The daily chart indicates that the ETH price has rebounded significantly in the past few days, now trading at its highest level since November.
The token has successfully moved above the upper boundary of a falling wedge pattern, which is a commonly recognized bullish reversal signal.
Additionally, Ethereum is on the verge of flipping the Supertrend indicator from red to green. The last time this indicator flipped to green was in July, following which the coin experienced a substantial rebound, reaching a record high a few months later. Such a technical development could potentially drive the price above $4,000 in the near future.