PelinayPA2026-02-26

Shorts in Ethereum Have Been Cleared. Next Up: Long Positions!

Funding remained positive for an extended period, signaling that long positions dominated the derivatives market and were paying funding fees to shorts. This reflected sustained bullish expectations. However, price did not consistently rally during these positive funding phases, proving that positive funding alone does not guarantee upward movement. More recently, funding rates flipped sharply negative with deep red spikes, indicating aggressive short positioning. At the same time, price faced clear downward pressure, confirming that bearish leverage had taken control. Binance data is especially important here, as it represents the largest share of global derivatives liquidity and hosts the highest leveraged volume. Liquidation cascades often begin there and spread across the market. For Ethereum, Binance funding acts as a key indicator of overall risk appetite and leverage direction, directly influencing short to mid term momentum. Currently, funding has turned green again. This suggests that short positions have been largely cleared and that the market is shifting back toward positive leverage, with longs paying funding fees once more. The return to positive funding signals that aggressive downside pressure is easing and allows room for a short term price stabilization or relief bounce. However, positive funding alone does not confirm a new uptrend. For a sustainable rally, funding must remain at moderate levels. If it becomes excessively positive, the risk shifts toward a potential long squeeze. Unless the $2,500 resistance level is decisively broken, it remains difficult to argue that the broader trend has fully turned bullish.