Traders suggest Ethereum's price could rally to $3,200 following a "Golden Cross" pattern, but other ETH price indicators tell a less bullish story.
Key Takeaways:
- Ethereum failed to reclaim $2,600, with futures and options data reflecting weak trader confidence.
- Growth in Ethereum’s Layer 2 ecosystem hasn’t boosted ETH demand, constrained by low Rollup transaction fees.
- The launch of a Solana ETF has eroded ETH’s dominance among altcoins, reducing its likelihood of breaking $3,200.
Ethereum (ETH) surged 9% between Tuesday and Thursday but struggled to surpass the $2,600 resistance level. As prices rebounded, traders noted a bullish technical pattern called the "Golden Cross," potentially signaling a push toward $3,200—a level last seen in January. However, derivatives data reveals muted bullish sentiment among ETH traders.
👉 Why Ethereum's Layer 2 growth isn’t translating to ETH price gains
ETH Derivatives Show Weak Confidence Amid Growing Competition
Despite ETH briefly hitting $2,600 on Thursday, demand for leveraged long positions remained subdued. In neutral markets, monthly contracts typically trade at a 5%–10% annualized premium over spot prices to account for extended settlement periods.
Currently, Ethereum futures premiums linger below the 5% neutral threshold, even after recent price gains. This metric last signaled bullish momentum on January 26, when ETH traded near $3,300. Notably, that day coincided with the launch of the official Trump (TRUMP) meme coin on Solana, boosting the blockchain’s transaction volume and revenue.
The Solana Factor
X user @cryptunez highlighted that Solana’s decentralized applications (DApps) generated $1.3 billion more in revenue than Ethereum. However, this narrow analysis overlooks Ethereum’s strategic shift toward Layer 2 scaling. Much of the ecosystem’s DApp revenue now flows to Layer 2 solutions like Base, Arbitrum, Polygon, Optimism, and Unichain.
👉 How Solana’s MEV controversy impacts Ethereum’s competitiveness
Rollups and ETH Demand
X user @R89Capital summarized investor sentiment: Ethereum proponents were "right about corporations building Layer 2 ecosystems" but "wrong to assume this would benefit ETH." Essentially, Rollups’ minimal fees encourage adoption but fail to drive significant demand for ETH itself.
Coinbase protocol expert Viktor Bunin noted that interoperability remains a major hurdle for Ethereum’s Layer 2 ecosystem. Without incentives for collaboration, teams pursue isolated solutions. Bunin argues that meaningful progress requires more direct involvement from the Ethereum Foundation.
Options Data Reflects Neutral Sentiment
To gauge professional traders’ confidence in ETH’s recovery, the 30-day options delta skew is instructive. In bearish conditions, put (sell) options trade at higher premiums than call (buy) options, pushing the skew above the 6% neutral threshold.
Currently, ETH options skew sits at 1%, indicating traders see equal odds of price movement in either direction—unchanged from the previous week.
FAQ Section
What is a "Golden Cross" in trading?
A Golden Cross occurs when a short-term moving average (e.g., 50-day) crosses above a long-term moving average (e.g., 200-day), traditionally signaling bullish momentum.
Why hasn’t Ethereum’s Layer 2 growth boosted ETH prices?
Layer 2 solutions like Rollups process transactions off-chain with minimal fees, reducing direct demand for ETH while improving scalability.
How does Solana’s ETF affect Ethereum?
The Solana ETF introduces competition for institutional investment, potentially diverting capital from ETH and other altcoins. Its embedded staking feature also raises the bar for Ethereum’s value proposition.
Derivatives data sourced from Laevitas.ch; community insights compiled from X (formerly Twitter).
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