Ethereum Reclaims $2K Amid CPI Data, Futures Shift

The rebound in Ethereum’s price above the $2,000 psychological level coincides with a dramatic shift in derivatives markets. According to data from CryptoQuant, futures open interest across major venues like Binance, Gate, Bybit, and OKX has fallen sharply. The reported decline of 80 million ETH in open interest over the last 30 days suggests a significant unwinding of leveraged positions rather than the establishment of new bullish bets. While the sheer scale of the figure invites scrutiny for potential reporting errors, a sizable pullback in futures exposure on these exchanges has been confirmed.

This reduction in open interest carries important implications for market stability. Lower leverage across the system decreases the immediate risk of cascading liquidations, which can help tame the extreme intraday volatility that has characterized recent crypto trading. However, the nature of the decline—indicating closed positions—also raises questions about whether fresh capital is waiting to enter or if the market is simply deleveraging after a period of stress.

Parallel to the drop in open interest, funding rates on perpetual futures contracts have swung into deeply negative territory. This dynamic means traders holding short positions are paying those holding long positions, signaling a strong and crowded bearish conviction. Reports indicate these negative funding rates have reached levels not seen in roughly three years.

Historically, such extreme sentiment positioning has often preceded sharp market reversals. The logic is that when the crowd becomes overwhelmingly one-sided—as seen with extreme shorting at the end of 2022—even a slight shift in momentum can trigger a short squeeze, forcing bears to buy back their positions and rapidly fueling an upward move. While this historical pattern does not guarantee an imminent rally, as markets can remain one-sided longer than expected, it does highlight that a significant amount of bearish betting is now active and potentially vulnerable to a squeeze.

Beyond derivatives, on-chain data from Glassnode provides a technical foundation for Ethereum’s current price action. The analysis reveals a significant cost-basis support zone between $1,880 and $1,900, where approximately 1.3 million ETH previously changed hands. This cluster represents a dense area of investor acquisition, potentially acting as a strong floor beneath the market.

From a chart perspective, the breakout from a recent falling wedge pattern points to an initial measured technical target near $2,150. This level would likely serve as the first major resistance test. Beyond that, analysts note further ceilings near $2,260 and then $2,500. The attainment of these targets is not a certainty; the broader market tone and, critically, Bitcoin’s direction will be decisive influences. Furthermore, reports of increased inflows to accumulation wallets during recent price dips hint at underlying longer-term conviction among some investors, providing a counter-narrative to the prevailing bearish sentiment in futures markets.