📰 Event Review

Recently, the ETH/USDT market experienced a wave of intense volatility. At the opening, the ETH price hovered around the $1970–$1979 range, but within just one hour, the price rapidly climbed to $2063, even hitting a high of $2090, before stabilizing around $2078.25 after a round of adjustments. During this process, high leverage liquidations, abnormal operations on trading platforms, and the fermentation of macroeconomic policy uncertainties collectively boosted market sentiment. Institutions and retail investors fiercely competed between panic selling and bargain hunting, resulting in a rapidly changing market that exposed a situation of tight liquidity and overbought risks.

⏰ Timeline

• 00:00
• The market opened, with the ETH price around $1970–$1979, against the backdrop of expectations of a partial U.S. government shutdown, disappointing employment data, and the latest policy statements from Federal Reserve officials, leading to heightened market tension.
• 00:00–01:11
• Within 71 minutes, the ETH price quickly rose from about $1970 to $2063, an increase of approximately 4.68%. During this period, a chain of liquidations of high leverage positions and some internal errors on trading platforms triggered a rapid outflow of funds intertwined with bargain buying.
• 00:00–01:30
• Other data showed that the ETH price further surged from $1979 to $2090 (an increase of 5.58%). Institutional funds intervened against the trend, driving this rebound.
• 01:45
• After a rapid rebound, ETH retraced and stabilized around $2078.25, reflecting that investors reassessed their positions and risks after the intense volatility. Although there was some buying behavior, overall sentiment remained tense.

🔍 Cause Analysis

Increased Macroeconomic and Policy Uncertainty

• Expectations of a partial U.S. government shutdown, disappointing employment data, and Federal Reserve officials' statements on interest rate policies have created a highly uncertain overall financial environment.
• Related news prompted institutions and retail investors to adjust their positions and reduce leverage, leading to concentrated liquidations and a situation where panic selling and short-term bottom-fishing alternated.

Internal Chain Liquidations and Operational Errors in the Market

• The chain liquidations of high leverage positions led to a rapid release of funds in the market, exacerbating price volatility.
• Some trading platforms experienced operational errors (such as incorrect fund airdrops), causing localized liquidity anomalies, resulting in a tug-of-war between panic sentiment and funds seeking to buy at lower prices.

📊 Technical Analysis

The following analysis is based on Binance's ETH/USDT perpetual contract 45-minute candlestick data:

• Overbought Signals

• The RSI indicator has broken above 70, entering the overbought zone, suggesting that the current price may correct in the short term;

• The KDJ indicator also shows overbought conditions, indicating potential corrective pressure in the short term, while the TD Sequential bearish setup (reaching 9) also hints at reversal risks.

• Price Momentum and Moving Average Trends

• The price is running along the upper Bollinger Band, and the appearance of patterns like the three white soldiers indicates strong buying power in the short term;

• MA5, MA10, and MA20 are in a bullish arrangement, showing short-term bullish sentiment; however, the price remains below the EMA120 moving average, revealing some long-term weakness signals.

• The slope of EMA20 is steep (1.82%), and the MACD histogram continues to grow, both indicating strong upward momentum in the short term.

• Volume Analysis

• Trading volume increased by 76.23% in the short term, with current trading volume significantly above the 10-day average, indicating a surge in market activity;

• Statistics show that approximately $6 million in liquidations occurred in the last hour, with short positions accounting for 76%, while a net inflow of about $30 million from major players indicates that institutional funds are also actively participating in bargain hunting.

🔮 Market Outlook

Currently, the ETH market is in a high volatility phase. Although the short-term rapid rebound shows that buying power once dominated, the overbought signals from technical indicators and the weakness of some medium- to long-term moving averages indicate that there is a significant risk of adjustment in the current market. Key outlooks are as follows:

• Short-term Risks and Adjustments

• The overbought state may prompt some profit-taking, and the market may experience a correction in the short term;

• The effects of high leverage liquidations have not completely dissipated, and if macro policy uncertainties intensify, prices may fluctuate again.

• Medium- to Long-term Potential

• If there are no further negative developments in the macroeconomic and policy landscape, and institutions remain steady in their bargain positioning, there is still hope for ETH prices to rise steadily in the future;

• Investors should pay attention to changes in trading volume, RSI, and key moving averages while managing their positions to cope with potential correction risks.

Overall, the current intense volatility of ETH prices reflects the rapid switching of funds within the market and is strongly influenced by the macro uncertainty environment. For investors, it is essential to remain highly vigilant in the short term, allocate positions reasonably, and implement strict stop-loss measures while waiting for market sentiment to rationally return, capturing medium- to long-term stable buying opportunities.

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