Ethereum Price Forecast: ETH Gains 10% Amid Declining CME Short Positions

Ethereum (ETH) surged 10% to $1,750 amid a decline in CME short positions, which fell below $500 million due to market corrections following Trump’s tariffs. Following a plunge in the CME basis, the ETH market appears to be gaining bullish traction, but requires holding the $1,688 support level and positive macroeconomic indicators for a continued upward trend. Futures liquidations reached $91.62 million in the past 24 hours, with investors advised to proceed with caution.

Ethereum (ETH) has experienced a notable rally, increasing by 10% following a general surge in the cryptocurrency market alongside Bitcoin. Currently priced at $1,750, this bullish trend comes after a significant decline in Ethereum’s Chicago Mercantile Exchange (CME) basis, which decreased from 20% in November to around 5% by April. The basis reflects the disparity between futures contracts and the underlying asset’s spot price, making recent changes pivotal for market dynamics.

The recent increase in ETH’s price occurred as short positions on the CME fell substantially, reportedly dropping below $500 million for the first time in 2025. This decline is attributed to arbitrageurs exiting trades following Trump’s tariffs and the Fed’s hawkish stance, leading to a broader market correction in cryptocurrencies and stocks. Consequently, many traders liquidated their spot ETH ETF holdings, contributing to the current market landscape.

Notably, recent data indicates that the net outflows from US spot ETH ETFs are nearing $1 billion, with total net assets plummeting to an all-time low. Analysts note that the closure of substantial arbitrage positions—previously prominent in the market—has occurred, aligning the CME basis with US Treasury yields. Despite the drop in short positions alleviating some downward pressure on ETH, the market remains in need of positive macroeconomic news to foster a sustainable bullish trend.

On Tuesday, Ethereum surpassed the critical resistance level of $1,688, having held for weeks. Futures liquidations amounting to $91.62 million were recorded in the past 24 hours. Observations show that the bullish momentum of ETH, although promising, faces potential resistance near the psychological level of $1,800. For a continuing upward trend, maintaining support at $1,688 is essential; otherwise, another phase of downside consolidation may emerge.

Technical indicators, such as the Relative Strength Index (RSI) and Awesome Oscillator (AO), are currently moving upward, suggesting potential for further gains. However, sustaining this positive momentum requires these indicators to remain above their neutral thresholds. Investors are advised to exercise caution and conduct thorough research before making investment decisions in this volatile market environment, as unforeseen risks remain prevalent in the cryptocurrency space, including the possibility of emotional distress and financial losses from investments.