According to CryptoPotato, Ethereum's price has been aggressively rallying over the past few days, approaching a strong resistance level that could determine its mid-term fate. On the daily chart, the price has been rallying since rebounding from the $2,200 zone, breaking the $2,400 resistance level with ease. Currently, ETH is climbing toward the $2,700 resistance level and the higher boundary of the large ascending channel. However, the Relative Strength Index (RSI) has also been rising, entering the overbought region, which might trigger a possible pullback or reversal as the price reaches the $2,700 resistance level.
Looking at the 4-hour chart, the recent rally becomes much clearer, with the price approaching the $2,700 resistance level almost vertically. This highly bullish momentum is also supported by the RSI, which is above the 70% level. Yet, with the RSI being oversold on the daily and the 4-hour charts, the probability of a correction after testing the $2,700 level is significant. Ethereum's price has been increasing rapidly over the past few weeks, with investors becoming optimistic once again, expecting the market to make a new all-time high in the coming months. To gain insight into potential short-term price developments, it is beneficial to evaluate futures market sentiment. Ethereum funding rates indicate whether buyers or sellers are executing their orders more aggressively on aggregate. Positive values show bullish sentiment, while negative values imply aggregate pessimism by futures traders. As the chart shows, the price drop a few weeks ago decreased the funding rates, but they are once again rising as the price rallies. While being a positive signal, high funding rates are also worrying, as they point to the increased probability of a long-liquidation cascade and, consequently, sudden price drops.
