Ethereum Marches Upward Without Leverage Overheating – Sign Of Structural Health?

As Ethereum (ETH) trades barely above $4,300, some crypto analysts opine that the cryptocurrency’s present development reveals sufficient structural well being. However, additionally they warning {that a} lack of funding charges throughout exchanges means low demand for ETH, which can restrict its breakout momentum.

Ethereum’s Latest Rally Shows Structural Strength

According to a CryptoQuant Quicktake put up by contributor ShayanMarkets, Ethereum’s funding charges throughout exchanges are comparatively muted when in comparison with the digital asset’s final three main highs.

For occasion, through the first main high in early 2024, ETH funding charges throughout crypto exchanges had surged to 0.8, suggesting extreme lengthy positioning and speculative demand. Shortly, the value topped out as overheated leverage took its toll on the digital asset.

During the second peak in late 2024 – as illustrated within the following chart – ETH reached related worth ranges however this time with far decrease funding charges. Although this hinted at a much less speculative market, the dearth of robust, sustained momentum ultimately weighed down on ETH’s worth.

In distinction to the above two situations, ETH’s 2025 rally noticed it create a brand new all-time high (ATH) of $4,900 – regardless of comparatively muted funding charges. This brings into focus one key divergence – ETH is hitting new highs even within the absence of aggressive lengthy positioning that fueled earlier rallies.

ShayanMarkets states there are two key implications of this new-found divergence. The analyst remarked:

On one hand, the market seems extra spot-driven and structurally more healthy, as worth isn’t being pushed by extreme leverage. On the opposite hand, the absence of aggressive demand additionally limits breakout momentum, leaving ETH in a slower-moving setting the place new order movement will probably be important for continuation.

Concluding, the CryptoQuant contributor famous that ETH’s larger highs towards declining funding charges present that the present market is extra resilient towards sudden liquidation cascades. However, it additionally requires much more conviction from patrons to maintain the following leg larger.

Is ETH Headed For A Correction?

Although ETH is at present buying and selling nearly 12% under its ATH, some analysts forecast that the second-largest cryptocurrency by market cap could also be headed for a correction. Crypto analyst Ted Pillows predicted that ETH might drop all the way in which all the way down to $3,900 earlier than its subsequent rally.

That mentioned, there are a number of different information metrics that time towards a possible bullish rally for ETH. For occasion, the ETH alternate provide ratio on main exchanges like Binance just lately hit a low of 0.037, which can help within the so-called “provide crunch” for the digital asset.

In related information, Ethereum alternate stability just lately turned unfavorable for the primary time, suggesting that extra tokens are being withdrawn from exchanges than deposited. At press time, ETH trades at $4,334, up 0.6% prior to now 24 hours.