Ethereum price rallies toward $2,800 but leverage buildup raises caution for bulls
Ethereum tests $2,800 after breakout as traders eye funding rate and leverage dynamics
Ethereum price climbed sharply in recent sessions, touching a high of $2,804 after breaking out of a multi-week accumulation range. The price currently trades near $2,780, with momentum accelerating following a decisive move above the $2,650 level.
Highlights
- Ethereum hit $2,804 before pulling back slightly; RSI shows overbought conditions near 77.6
- Open interest surged without matching spot volume, raising concerns over leverage-driven rally
- Funding rates crossed +0.03%, indicating growing long bias and potential for near-term volatility
The Relative Strength Index on the 4-hour chart stands at 77.6, indicating overbought conditions, while the Supertrend has remained positive since the breakout. Price action is supported by a strong bullish channel and a successful breakout from a falling wedge pattern visible on both the 4-hour and daily charts.
Derivative data shows long buildup as funding rates climb
Data from Coinglass reveals a significant rise in Ethereum open interest over the past 48 hours, coinciding with the upward price movement. This rise in open interest suggests new long positions have been added at elevated price levels, but without a proportional rise in spot volume. Such divergence often signals speculative trading behavior driven by leverage. Moreover, the funding rates for ETH perpetuals have turned increasingly positive, averaging above +0.03% across major platforms. This reflects a growing imbalance in long positioning, and historically, such sentiment skew has led to volatility spikes or short-term pullbacks.
ETH price dynamics (Source: Tradingview)
The Bollinger Bands on the 4-hour chart have widened significantly, with Ethereum currently trading near the upper band at $2,811. Price also remains well above all key exponential moving averages, with the 2,0 EMA at $2,659 and the 50 EMA at $2,586, underlining the strength of the ongoing trend. However, the $2,800 to $2,830 area is a known supply zone, which triggered multiple rejections earlier this year. A failure to close above this resistance could lead to a reversion toward $2,650 or $2,570.
Key resistance approaches as market awaits follow-through
Ethereum’s bullish momentum remains intact as long as the price holds above $2,570. A confirmed daily close above $2,800 would mark a significant structural shift and likely extend the move toward $2,950 and possibly $3,100. On the downside, if price slips below $2,650, it may neutralize the breakout and trigger a deeper correction. Traders should closely monitor funding rates and open interest trends to gauge whether the rally is sustainable or fueled by excessive leverage.
In earlier sessions, we highlighted Ethereum’s bullish setup above the $2,480 trendline and identified the $2,650 region as a key breakout trigger. That projection has now played out, but as new longs pile in, maintaining a cautious stance near resistance is prudent unless price confirms a strong close above $2,830.
