Ethereum Reclaims $2,500 In Squeeze-Driven Rally – But Can It Hold?

Ethereum's price has surged from $2,111 to $2,515 over the past two weeks, sparking hopes for a sustained bullish rally beyond the $3,000 level. The rally has been marked by a shift in market dynamics, including a flip to positive funding rates, a potential short squeeze, and a rise in ETH inflows to Binance crypto exchange. Positive funding rates indicate that traders are opening or holding leveraged long positions, expecting further upside, but also raise the risk of a short-term price pullback. Data shows that 68.15% of liquidations over the past 24 hours were long positions, highlighting this risk. A short squeeze has contributed to Ethereum's recent price surge, with traders who bet against ETH forced to close their positions by aggressively buying back the asset. ETH inflows to Binance have also spiked, with 177,000 ETH deposited over a three-day period, signaling increased selling pressure or large-scale repositioning by major holders. While a short-term correction may be likely, ETH's breakout above $2,500 underscores the aggressive speculative activity driving its recent price action. Traders are advised to closely monitor funding rates and exchange flows for signs of an impending retracement. Technical analysis suggests ETH may be gearing up for a breakout above the $2,800 resistance level, with a golden cross on the daily chart fuelling speculation that a new all-time high could be within reach. However, some analysts predict that ETH may revisit lower levels in the $1,700 to $1,950 range.