The post Ethereum Price Faces Pressure Amid Marketwide Funding Rate Reset, Potential for Rebound Remains appeared on BitcoinEthereumNews.com.

The ongoing fluctuations in Ethereum’s price reflect broader dynamics in the cryptocurrency market, driven significantly by recent funding rate adjustments. Recent trends indicate that as altcoins navigate through a market reset, the liquidity issues stemming from Bitcoin’s earlier drops are affecting Ethereum’s performance. Felix Hartman of Hartmann Capital highlighted the impactful nature of these funding rates, stating, “Most alts now have funding rates north of 100% annualized,” pointing to the market’s volatility. Ethereum faces a decline in price influenced by a marketwide funding rate reset, with key technical levels being closely monitored by traders. Ethereum’s Price Decline: Understanding the Market Reset Impact The recent decline in Ethereum’s price, which has dropped 3.94% in the last 24 hours, is a reflection of significant market activity, primarily driven by liquidations of leveraged positions. Reports indicate that over $44 million in leveraged positions have been liquidated, of which nearly $42 million were from long positions. This unexpected downturn follows a broader funding rate reset across the altcoin sector. Notably, the reset was triggered by Bitcoin’s abrupt price drop to $90,800 last week, which jolted funding rates for many altcoins, including Ethereum. As liquidity vanished, altcoin funding rates remained exorbitantly high, with many exceeding 100% annualized, which suggests heightened speculation but also risky trading behaviors. Market Sentiment and Funding Rate Adjustments The implications of the funding rate reset have profound implications for market sentiment. Recently, independent trader Jacob Canfield emphasized the adjustment of Ethereum’s funding rate approaching “near neutral,” signaling a potential stabilization phase. As noted, the current altcoin dynamics reflect a delayed reaction to previous market conditions, raising questions about future price movements. This sentiment is echoed by traders like Reetika, who noted that the current downturn signifies a necessary correction in response to prior leverage-induced highs. With funding rates nearing normality, traders…

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Filed under: News - @ December 9, 2024 8:27 pm