Ethereum Price Analysis and Market Sentiment
Published: June 04, 2025
Author: Alejandro Arrieche
Key Highlights
- Open interest in Ethereum (ETH) futures reached a record high of $37.6 billion.
- The long/short ratio for ETHUSDT indicates a bullish sentiment but raises concerns about a potential pullback.
- A bearish divergence is observed in the daily Relative Strength Index (RSI).
Market Overview
Following Bitcoin's recent all-time high, the cryptocurrency market has entered a consolidation phase. Traders are currently awaiting new catalysts to drive the next price movement. The ongoing trade tensions between the White House and China have contributed to a cooling of the market enthusiasm that followed Bitcoin's record price.
Open Interest and Trading Sentiment
The record open interest in ETH futures suggests strong bullish momentum; however, it also indicates a risk of a significant pullback as the market sentiment appears overly optimistic. The long/short ratio for ETHUSDT futures has dropped to its lowest level in 30 days, yet it remains high at 1.31, suggesting that traders are heavily betting on a bullish outcome.
Technical Analysis
The recent Pectra upgrade has enhanced Ethereum's scalability and efficiency, likely contributing to the increased trading interest. The daily chart shows a 'golden cross' where the short-term moving averages have crossed above the 200-day EMA, typically interpreted as a bullish signal. However, the RSI indicates that the price momentum is weakening, which could signal an impending correction.
Key Levels to Watch
Traders should monitor the following key levels:
- Resistance: $2,750 - $2,800
- Support: $2,550 (historically significant) and $2,475 (multiple bounces observed).
Conclusion
While Ethereum shows signs of bullish momentum, the combination of record open interest, high long/short ratios, and bearish divergence in the RSI suggests that traders should remain cautious. A strong pullback could be on the horizon if the market sentiment shifts.