Ethereum bulls eye $2,500 amid a spike in Open Interest

The cryptocurrency market has been bullish since the start of the week, with Bitcoin touching the $74k level on Wednesday.

Altcoins are not left behind, with Ether leading the way.

Ether is trading above $2,100 on Thursday following a general recovery across the crypto market.

The rally comes amid a surge in Ethereum's open interest (OI), which has increased to 13.43M ETH — its highest level since January 31. 

The OI has been increasing since February 19, adding over a million ETH in the last two weeks.

The increase in OI comes after $126 million worth of leveraged positions were liquidated in the Ethereum market since Wednesday, led by $101 million in short liquidations. 

Ether’s OI continues to increase

ETH is one of the best performers among the top 10 cryptocurrencies by market cap.

It is currently trading above $2,120, with the bulls aiming to push the price higher in the near term.

The rally comes amid improved derivatives data.

According to CoinGlass, Ether’s OI stands at $28.4 billion on Thursday.

The OI has been increasing since February 19, indicating renewed interest among retail traders. 

Despite ETH's OI increase, funding rates have continued to show consistent negative and positive readings, indicating uncertainty from traders. 

Thanks to the ongoing rally, Ether is now approaching the average on-chain cost basis of investors, or its realized price, at $2,300. 

Historically, a push above the realized price tends to spark short-term distribution, with many investors exiting their positions after breaking even. 

However, an extended rally could establish this level as a key support area.

The market could also experience a breather soon after a New York Times report on Wednesday said that operatives from the Iranian Ministry of Intelligence indirectly reached out to US intelligence agencies with a ceasefire offer.

Ethereum price  outlook: ETH eyes $2,500 after breakout above key resistance

The ETH/USD 4-hour chart is bearish and efficient, but Ether is looking to capture new resistance levels thanks to its ongoing rally. 

The near-term bias has switched bullish as ETH holds above the 20-day Exponential Moving Average (EMA).

If the rally continues, ETH could surge towards the 50-day EMA at $2,298.

An extended bullish run would allow the leading altcoin to retest the $2,500 psychological level for the first time since January 31.

The  $2,746 and then $3,411 resistance areas could appear in the medium term if buyers extend control.

The Relative Strength Index (RSI) at 62 is above its neutral level, confirming improving upside momentum. 

The MACD lines have also converged in the positive region, adding further bullish confluence to the chart. 

However, if the bulls fail to capitalize on this recovery and the daily candle closes below the $2,108 support, ETH could retest the secondary support around $1,741 ahead of $1,524.