Ethereum (ETH) Sets the Stage for a Major Price Rally: Key Insights to Watch

Ether (ETH), the second largest cryptocurrency by market capitalization ranking, recently soared from around $3,000 earlier this month to $3,500 for the first time this year before it lost some of its momentum.

In a recently published crypto derivatives report, Bybit and research firm Block Scholes highlighted several factors, including macroeconomic developments and trading signals from the spot and futures market metrics, that could give ETH the much-needed push to reclaim higher price levels.

What Could Drive ETH’s Surge?

Perpetual swap funding rates have fluctuated in alignment with spot prices while maintaining a positive record for most of this month, especially for ETH. Bybit’s report explained that this translates to a “strong demand for long positions in the contract despite the downturn, or at least a lack of interest in short positions, due to liquidations or other factors.”

Additionally, the crypto options market reflects a mix of short-term caution and long-term optimism. Due to uncertainty, traders are hedging against potential short-term price drops. However, they remain optimistic about the market’s long-term prospects, as the bullish skew in longer-dated options contracts shows.

Moreover, the recent Consumer Price Index (CPI) data triggered a change in market structure as BTC, ETH, and many altcoins headed north. The bullish volatility smile indicates increased speculation and betting on potential price uptrends.

Meanwhile, news about the incoming inauguration of the pro-crypto President-elect, Donald Trump, has recently boosted the market’s uptrend. Agreeably, the crypto community eagerly expects a new America with less strict crypto trading and investment laws.

Thus, investors have switched attention to digital assets, mostly ETH and BTC, as they have struggled to gain regulatory clarity involving these assets over the past few years and survived different wavering market conditions.

More Altcoins to Record Uptrends

Like ETH, a few altcoins have also recently displayed bullish momentum. These include SOL, XRP, LTC, and others. Due to XRP’s 40% surge over the past week to reach $3.40, a few bullish and optimistic traders predict it may soar to $100 soon.

Meanwhile, SOL became the biggest beneficiary of the TRUMP-induced price rally and shot up to a new all-time high of its own of almost $300 at press time.