Event Review 🔥

Recently, the ETH market experienced significant volatility, attracting widespread attention. Starting at 20:05, the release of the U.S. Producer Price Index (PPI) annual rate at 3.3%, far exceeding market expectations, sent negative signals from the macroeconomic front, leading institutional funds to quickly flow back and reduce risk appetite. Meanwhile, on-chain monitoring data showed abnormal large fund outflows, frequent automatic stop-losses, and liquidations, accelerating market panic. The ETH price plummeted rapidly within just a few minutes, with multiple data sets showing:

• In one record, ETH dropped sharply from about $4737 to $4567, a decline of 3.59%.
• Another set of data indicated a drop from $4730 to $4496, a decline of nearly 4.94%.
  By 21:00, ETH began to enter a consolidation phase, with the latest price reported at $4525.01.

Timeline ⏱

• 20:05

• Shocking macro data: PPI annual rate recorded at 3.3%, indicating a clear rise in production costs.

• Market sentiment shifts sharply: funds begin to withdraw from high-risk assets, while on-chain abnormal fund outflows and automatic stop-loss events start to appear.

• At that time, ETH was priced in the range of approximately $4730–$4737.

• 20:05 – 20:31

• ETH price plummets: price records show a drop to between $4496-4567 within 26 minutes, with a decline exceeding 4%.

• Technical indicators show: MACD forms a death cross, RSI drops to the oversold zone, and trading volume surges, all reflecting signs of panic selling.

• 21:00

• Market enters a consolidation period: some funds begin to flow back, with a strong wait-and-see sentiment, and the latest price drops to $4525.01.

• Overall market sentiment turns cautious, awaiting guidance for the next phase.

Reason Analysis 🔍

The recent ETH crash is primarily driven by the following two core factors:

1. Macroeconomic Shock

• The U.S. Producer Price Index (PPI) annual rate reached 3.3%, significantly higher than market expectations, indicating increased price pressure in the production sector and rising inflation expectations.
• Under the influence of rising inflation expectations and increased uncertainty regarding future Federal Reserve interest rate policies, institutional funds accelerated their withdrawal from high-risk assets (including crypto assets), leading to a decline in market risk appetite.

1. On-chain Abnormalities and Technical Triggers

• Multiple large fund transfers, automatic stop-losses, and liquidation data emerged, causing significant net outflows from some institutional and exchange accounts at critical moments (with nearly $1 billion net outflow in the main market within an hour).
• When trading volume surged (up 251.91%) while prices simultaneously fell, panic selling sentiment further amplified downward price pressure.

Technical Analysis 📊

Based on the Binance USDT perpetual 45-minute candlestick data, the technical characteristics of this round of ETH are as follows:

• Trend Indicators

• MACD: Crossed below the zero line, with histogram bars continuously decreasing, indicating enhanced downward momentum;

• RSI: Has fallen below 30, entering the oversold area, although at a low level, it may signal potential short-term rebound opportunities;

• KDJ: A death cross has appeared, indicating a lack of buy signals and a clear downward trend.

• Moving Averages and Bollinger Bands

• MA5, MA10, and MA20 are in a bearish arrangement, indicating price pressure in the short term;

• Prices are running along the lower Bollinger Band, with candlestick patterns showing long wicks and belt hold lines, indicating severe volatility under strong selling pressure;

• Although the current price is above the EMA120 moving average, indicating a long-term bullish trend, it has been significantly impacted in the short term.

• Volume Analysis

• Trading volume surged, and the ratio relative to price volatility is abnormally high, indicating strong panic selling behavior in the market.

• Liquidation Statistics

• In the past hour, the total liquidation amount across the network was approximately $40 million, with long positions accounting for 87%, further corroborating the market's extreme anxiety.

Market Outlook 🌅

Looking ahead, ETH may continue to consolidate in the low range in the short term, with major risks and uncertainties still present:

• If macroeconomic data (such as future PPI, CPI, and core PCE) continues to point towards high inflation, and the Federal Reserve maintains a dovish tightening stance, market risk appetite may remain low, potentially sustaining selling pressure in the short term.
• On-chain fund inflows and outflows, along with the activation of automatic stop-loss mechanisms, suggest that technical indicators will remain weak in the short term, but the RSI being in the oversold state may provide some short-term rebound opportunities.
• In the long run, ETH remains an important foundational asset for blockchain technology and decentralized applications. If institutions can reposition themselves, on-chain fundamentals improve, and market sentiment recovers, a technical rebound may open a new consolidation phase.

Overall, investors need to closely monitor changes in macroeconomic data, on-chain fund flows, and the subsequent evolution of technical indicators, cautiously adjust their positions, manage risks effectively, and avoid frequent entries and exits due to short-term fluctuations.

This article is based on the current Binance USDT perpetual 45-minute candlestick data and real-time on-chain monitoring data, and is intended for market analysis and opinion sharing only, not constituting any investment advice.

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