Event Review 📉

Around 22:00, the ETH price hovered at approximately $2369, influenced by both macroeconomic policies and institutional fund adjustments. In just 36 minutes, starting from 22:00, the ETH price plummeted from $2369 to around $2270, with a decline between 3.9% and 4.2%. Subsequently, after a brief market adjustment, it rebounded to about $2315.29 at 23:05, but overall remained in a state of fluctuation. This volatility not only reflects the market's sensitive reaction to macroeconomic news but also exposes the chain reaction caused by institutional fund automatic stop-losses and whale profit-taking.

Timeline Review ⌚

• 22:00 – ETH price around $2369. Macroeconomic factors (such as the Federal Reserve maintaining interest rates and tariff uncertainties) triggered a decline in risk appetite, leading institutional funds to begin deploying automatic stop-losses and whale profit-taking actions near key technical support levels (around EMA24/EMA52).
• 22:00 to 22:35 – Within 36 minutes, concentrated market sell-offs triggered automatic stop-losses and quantitative trading strategies, causing the ETH price to rapidly decline to approximately $2270–$2277, with a drop of nearly 4%.
• 23:05 – After a brief adjustment, some buying interest entered the market, and the ETH price rebounded to about $2315.29, but the fluctuation persisted.

Reason Analysis 🔍

The sharp volatility of ETH can mainly be attributed to the following two objective factors:

1. Macroeconomic Policies and Market Sentiment Shift
   Frequent macro news such as the Federal Reserve maintaining interest rates, tariff risks, and trade policy uncertainties, along with statements from some high-level officials, triggered an increase in investor risk aversion. The overall risk appetite decreased, leading both institutions and retail investors to tighten their risk asset allocations, thereby weakening confidence in ETH and triggering a chain of sell-offs.

2. Institutional Fund Adjustments and Technical Automatic Stop-Loss Triggers
   In key support areas (such as EMA24/EMA52), a large number of automatic stop-loss orders and quantitative trading strategies were triggered simultaneously, combined with concentrated sell-offs from whale profit-taking, resulting in a sharp reduction in market liquidity and causing prices to plummet. Additionally, the total amount of liquidations across the network reached $10 million in nearly one hour, with long positions accounting for 70%, while major transaction data showed a net outflow of up to $100 million, exacerbating selling pressure.

Technical Analysis 📈

This technical interpretation is based on the 45-minute candlestick data of the Binance USDT perpetual contract ETH/USDT, with the following key observations:

• KDJ Indicator: The indicator is diverging, and the downward trend is intensifying, suggesting a short-term advantage for the bears.
• Volume Observation: Current trading volume is only 46.94% of the average level, significantly below the 10-day average, indicating weakened market buying interest, but the 20-day average volume has increased by 7.76%, showing enhanced mid-term activity.
• Candlestick Pattern: A pregnant candlestick pattern has emerged, with the second candlestick completely engulfed within the first candlestick's body, indicating a potential reversal signal.
• Moving Average System: The price is currently supported near MA20, and both MA20 and MA50 are sloping upwards, with the CTA indicating that the mid to long-term trend remains upward; simultaneously, EMA5/10/20/50/120 are all in a bullish arrangement, with the slopes of EMA120 and EMA24/EMA52 rising, showing strength in both the long and mid-term, but the continuous reduction in the MACD histogram warns of increasing short-term downward momentum.
• TD Price Reversal: Some indicators show bullish price reversals, which may indicate early changes in the trend, but significant volatility risks still exist in the short term.

Market Outlook 🚀

In the short term, although ETH showed signs of some technical support and buying interest at 23:05, the ongoing macro uncertainties, along with institutional fund adjustments and low trading activity, may lead to continued fluctuations in a high-sell low-buy pattern. Traders need to pay attention to the following points:

• Support Levels: The MA20 area will be an important support for future rebounds; if it can hold, the mid-term trend may maintain an upward trajectory.
• Volume Changes: Whether trading volume increases will be an important signal for determining if the trend can continue.
• Macroeconomic Policy Signals: The uncertainties surrounding Federal Reserve policies, tariffs, and trade policies will continue to have a significant impact on market sentiment, and investors should closely monitor changes in related news.
• Quantitative Strategies and Stop-Loss Risks: Automatic stop-losses and quantitative trading strategies may trigger severe volatility again in the future, making risk management crucial.

Overall, despite the current short-term pressure on ETH, the technical outlook shows solid support, and the long-term upward trend remains unchanged. Investors should remain cautious, closely monitor market dynamics, manage risks effectively, and wait for market sentiment to stabilize before making further moves.

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