As markets kicked off this week on a positive note, Ethereum [ETH] co-founder Vitalik Buterin shared insights on potential improvements to the Proof-of-Stake (PoS) system. He reflected on what could still be improved after the blockchainâs major transition in âThe Merge.â
In a recent post, Buterin highlighted key proposals, including the feasibility of a single slot for faster block confirmation, democratizing staking by lowering barriers to entry, and single secret leader elections to enhance security by obscuring block proposers until announcement.
ETH Market Situation
This new proposal, coupled with Monochrome Asset Managementâs plans to launch the first Ethereum spot exchange-traded fund (ETF) in Australia, has had a positive impact on prices.
At press time, ETH was trading at $2,520, marking a 2.37% price increase over the past 24 hours.
Additionally, the moving average convergence divergence (MACD) has formed a bullish crossover, further confirming the fresh bullish momentum.
Although the price has crossed above the 20-day EMA, there has been no clear move above the 50-day EMA yet.
Reclaiming this level would allow bulls to extend the rally to $2,700. Furthermore, to reverse the longer-term bearish trend, ETH bulls would need to clear the 200-day EMA resistance at around $2,800.
What do the numbers say?
Like the price, Ethereum's market dynamics are also showing interesting signs of change. More short orders than long orders suggest that sellers are being forced out of their positions, leading to a short squeeze.
The positive funding rate, according to CryptoQuant, has reinforced this bullish trend. Furthermore, the weighted Sentiment Index of 0.131 reflects a fairly positive outlook among investors, implying increased confidence.
Is the price increase threatened?
Despite the recent recovery, AMBCrypto's analysis of the Coinglass liquidation heat map still suggests caution is needed.
Over the past week, a strong liquidity cluster has formed around the $2,400 level. This magnetic zone could attract prices towards it. This level could act as important support in the event of any pullback.
While the possibility of a short squeeze remains, a drop below $2,400 could trigger buying liquidation and a trend reversal.
