Perpetual futures markets significantly influence the overall price dynamics of the crypto market. By analyzing futures traders' sentiment, we can forecast potential price trends. The 50-day moving average of Ethereum's (ETH) funding rates offers insight into market aggressiveness from buyers and sellers.

Recently, ETH funding rates have consistently declined, reaching their lowest levels in 2024. This trend indicates a bearish sentiment and a lack of buying interest. For Ethereum to recover, demand in the perpetual futures market must rise. If negative funding rates persist, Ethereum may face further price declines in the mid-term.

However, negative funding rates can sometimes signal market recovery through short liquidation cascades, contingent on sufficient spot buying pressure. Without this demand, Ethereum's price may remain under pressure.