After months of sustained downward pressure, Ethereum has regained the $2,300 level as fresh buying activity started to push the market higher. The move marks a notable shift in short-term sentiment, with traders increasingly pointing to growing bullish momentum across the broader crypto sector.
Bitcoin has gained about 8.6% over the past seven days, fueling speculation that the market may be emerging from the correction that has dominated the past few months.
Ethereum, which often operates as a high-beta asset within the cryptocurrency ecosystem, is responding more aggressively to improving sentiment. During the same period, ETH has surged about 13.9%, outpacing Bitcoin, indicating increased speculative demand from traders.
Analysts said the rally was also supported by strong inflows into crypto-related exchange-traded funds, reflecting continued institutional demand for digital assets. As liquidity begins to return and risk tolerance improves, Ethereum’s ability to regain the $2,300 level is now being closely monitored as a key point that could determine whether the recovery extends further in the coming weeks.
Ethereum leverage regains after historic liquidation reset
CryptoQuant’s recent analysis highlights how the Ethereum derivatives market experienced a major structural reset following the dramatic liquidation event that occurred on October 10th. According to the report, the flash crash triggered one of the largest deleveraging events in crypto market history.
During this event, Binance’s Ethereum Estimated Leverage Ratio (ELR) plummeted from 0.56 to 0.41, indicating a 27% reduction in market leverage. The “10/10” event is now widely recognized as the largest 24-hour liquidation cascade in crypto history, with over $19 billion of leveraged positions forced into market-wide liquidations.
Since that reset, leverage levels have gradually rebuilt as confidence returns. The report notes that Ethereum’s ELR rose to around 0.69 in mid-March, suggesting that traders are once again increasing their use of leverage as sentiment improves.
The estimated leverage ratio is calculated by dividing the open interest by the amount of ETH reserves held on the exchange. It actually measures how aggressively traders are using leverage against the collateral available in the system.
High ELR values typically indicate increased risk appetite and speculative positioning, which can amplify both upward price momentum and market volatility.
As sentiment improves, more defensive investors may turn to tokenized gold products such as PAXG and XAUT, while Ethereum and Bitcoin continue to serve as high-beta, risk-on assets.
Ethereum attempts trend reversal after February capitulation
Ethereum’s charts show that the asset is about to gain bullish momentum after a prolonged correction that has dominated the market since late 2025. On the daily time frame, ETH is currently trading around $2,310, undergoing a significant rebound from the sharp decline that occurred in early February.
This decline has pushed Ethereum towards the $1,800 area, with an apparent spike in trading volume indicating a capitulation event and the absorption of active buyers. Since this low was formed, the price trend has gradually stabilized, with Ethereum building a higher base between $1,900 and $2,100 before starting the current bull market.
Technically, ETH has now regained its short-term moving average, which served as dynamic resistance throughout the downtrend. This development suggests that near-term momentum is shifting back in favor of buyers. However, the broader market structure remains cautious as prices are still trading below their long-term 100-day and 200-day moving averages, continuing a downward trend.
Currently, the $2,300 to $2,400 zone is a significant area of resistance. This level previously acted as support before the February breakdown and could attract significant sell-side liquidity.
If Ethereum manages to consolidate above $2,300, it could open the door for a continuation towards the next major technical barrier and moving average convergence at $2,600 and $2,900.
Featured image from ChatGPT, chart from TradingView.com
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