Recently, this final week of June, the Ethereum price has demonstrated a powerful spike, decisively breaking above and re-testing the crucial $2,500 mark. 

This upward movement reflects a notable price action in ETH crypto driven by a confluence of factors that signal strong bullish sentiment, but also caution against potential short-term volatility has appeared as it began consolidating in $2400- $2500 range. 

Even popular analyst Degen Hardy noted with caution that he will stay long on ETH as long as it remains above the $2,400 mark. As he believes in the short term, if $2400 is taken out, it will mean that bulls are struggling to reclaim untapped weekly highs.

As the second-largest cryptocurrency with $295 billion market cap commands attention, as understanding these underlying forces is crucial for traders and investors alike. Keep reading to know more.

Shifting Sentiment and the Impact of Short Squeezes

A recent study from a CryptoQuant analyst reported a shift in funding rates on Binance, moving from negative to positive territory. Indicating leveraged long positions are aggressively betting on a continued ETH price rise.

Per the analyst, this reflects widespread optimism, but it also raises severe concerns of the market turning into “overheating,” where further increases could precede with a short-term correction. 

Inflows Signal Potential Selling Pressure

Analyst further adds that on-chain data presents a cautionary note, despite the recent strong price action, which was primarily driven by geopolitical ease with war-involved countries agreeing to a ceasefire. 

As the data reveals, Binance witnessed an inflow of 177,000 ETH over three consecutive days. This movement of ETH crypto onto exchanges has higher odds that some large holders may be preparing to take profits or reallocate their assets.

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Ethereum Awaiting Correction In Short-Term Outlook

Ethereum’s spike clearly highlights the aggressive speculative activity, but the simultaneous and substantial inflow of ETH crypto onto Binance points to a looming possibility of selling pressure, too.

Even analysts like Hardy are cautious and willing to close their running positions if bulls can’t push higher in the short term. This increases the likelihood of a dip coming, as the market might aim to normalize the current overheated funding dynamics. 

While a retracement might be on the horizon in the short term, the underlying long-term bullish structure of Ethereum crypto price appears intact.

In addition, if the box’s lower border is breached, then short-term fall will pull ETH price to June 22nd low at $2120, but if the upper border is pierced, then the minimum aim is set at $2620.