Daily Analysis of #ETH

1️⃣ Structural interpretation 2950 is just a matter of a final push, there is some space below here. If 2900 breaks, the consequences will be quite serious, and the maximum above can reach around 3600.
2️⃣ Capital Flow & On-chain & Exchange Dynamic Capital Flow: There is immense pressure on the capital front. The spot Ethereum ETF is also facing a large-scale capital outflow, with a weekly net outflow exceeding $1.4 billion. This is similar to the situation in the Bitcoin market, indicating that institutional investors are fully withdrawing from the cryptocurrency market. On-chain data: Long-term holders are also accelerating their exit. On-chain data shows that long-term holders of ETH (3-10 years) are selling their tokens at the fastest rate since 2021, creating additional market supply pressure. Exchange dynamics: Divergence in the views of whales. Despite facing significant selling pressure, data shows that some large addresses (whales) have been accumulating during the market downturn, with multiple whales accumulating over $1 billion worth of ETH. This indicates a significant divergence between the bullish and bearish sides of the market at the current position.
3️⃣ Trading strategy during the day should be cautious when bottom-fishing. There are signs of a golden cross in the 1-hour chart, and what we need to do is patiently wait for the rebound to end before placing short positions. Next, if the 1-hour chart recovers strongly, it may drive an increase in the 4-hour chart, so we will continue to observe closely. The best short position is at the extreme reversal point on the 4-hour chart. For aggressive traders, trying a short position at 3200-3250 could be considered. Conservative traders should wait patiently.
4️⃣ Risk Warning Liquidation Leverage Risk: The ETH derivatives market has high leverage, and if prices continue to fall, it may trigger a chain liquidation, leading to a "long squeeze" market, drastically amplifying the decline. Market Correlation Risk: The trend of ETH is highly correlated with BTC. If BTC fails to stop its decline and continues to drop, the $2900 support level for ETH will face immense pressure and may very likely be breached. Ecosystem Confidence Risk: Continued sharp declines may affect the confidence of developers and users in the Ethereum ecosystem. If it leads to a shrinkage in on-chain activities, it will, in turn, weaken its fundamentals and value support.