The Ethereum futures market is signaling a sentiment shift.

The sentiment shift appears linked to recent price action.

Despite this potential sentiment shift, there is still room for doubt.

2024 has seen the crypto market largely continue the resurgence that began in 2023. But while assets like Bitcoin (BTC) and Solana (SOL) have continued their strong performance, fellow market leader Ethereum (ETH) has seemingly lost momentum. Amid the asset’s continued underperformance, investor sentiment has taken a significant dip, but this sentiment may now be shifting, according to a recent analysis from CryptoQuant.

Bullish ETH Sentiment Building?

The Ethereum futures market is signaling a shift in sentiment. In a Thursday, October 31 note, CryptoQuant analyst “ShayanBTC” argued that futures traders were becoming more optimistic about the asset’s price. Sponsored

Futures refer to contracts that allow traders to speculate on the price of an asset without having to hold it. According to ShayanBTC, funding rates, a metric used to gauge sentiment in the futures market, had flipped positive and were showing signs of an uptrend. This indicates that there are more bets on Ethereum’s price rising than on it falling.

The analyst suggested that the recent funding rates shift was likely sparked by ETH’s recent glimmers of strength. Over the past two weeks, the asset has threatened to break above two-month highs around the $2,800 price level.

ShayanBTC noted that ETH bulls would want to see this positive funding rates trend significantly higher for a sustained rally.

“For Ethereum to overcome key resistance levels and sustain an upward trajectory, a higher funding rate would signal increased buying interest and confidence from futures traders. Higher funding rates would not only confirm participants’ willingness to go long on Ethereum but would also add upward pressure on the price, potentially leading to a stronger and more sustained rally,” the analyst wrote.

But while funding rates are showing signs of market optimism, one leading analyst has contended that not much has changed on the price chart.

A Bearish Chart

According to veteran commodities trader Peter Brandt, ETH’s chart “remains bearish.” The view comes as the asset failed to validate a bullish inverse head and shoulders pattern that had flashed on its daily chart. As things stand, the analyst contends that the asset is likely to fall as low as the $1,551 price point.

For context, at the time of writing, ETH is trading around the $2,490 price point. A fall to $1,551 would represent an over 60% decline.

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