When the US stock market sneezes, the crypto market catches a cold! Last night's flash crash is a living example—the minor technical issues were smashed down into the ICU by US stock market data!
Brothers, did you all see that wave of ETH plunging last night? It was truly thrilling! Just as it touched $2550, before you could even settle in, it 'whooshed' down to 2363, nearly $200 vanished, evaporating 7% in an hour, faster than a roller coaster! Many brothers privately messaged me asking what happened, let me break it down for you:
Technical Analysis: It's already the last gasp, just holding on!
Case Study: Look at that $2550, like a heavy lid; it has failed to break through after three attempts in the past three days. It's like chasing a girl; if you've asked out three times and she doesn't come out, the fourth time you push it, the result is likely to be a cold shoulder! The bulls have already exhausted their strength, and their confidence has been worn away.
Case Study: More critically, although the price brushed a small new high before the crash, look at the RSI indicator on the 1-hour chart, it was actually going down! It’s like driving a car, you floored the gas, but the speed keeps dropping, how can you not stall? This is called 'divergence at the top', a textbook warning for a downturn!
Fatal Blow: What's next? The price suddenly crashed through the key support of $2500, and the trading volume surged. It was like knocking down the first domino, triggering a massive number of programmatic stop-loss orders, instantly causing a stampede! Retail investors, seeing the breakdown, also panicked and fled without a plan.
Autumn Brother's Brickbat View:
The technical side has long buried the landmines! The price has failed to break above 2550 three times, what does that indicate? It indicates that the main force does not really want to push it up with real money! They may be luring buyers or waiting for an opportunity to escape. A pullback? That's just a matter of time; last night, the US stock market only provided an ignition opportunity.
News: The US stock market plunged, precisely triggering the explosion!
Trigger: Last night at 9 PM (our local time), the US released retail data, it was bad! Worse than expected. Goodness, the Dow Jones (representing major US companies' stocks) instantly plummeted over 400 points! That scene was more thrilling than A-shares.
Why did ETH crash? The crypto market is now like the US stock market, they are 'wearing the same pants'! The correlation is frighteningly high (reportedly 90%). Why? Because a lot of the big money buying ETH and Bitcoin comes from the same institutions! When the US stock market crashes, institutions, fearing losses, will immediately sell off their 'high-risk' assets to hedge. ETH has a large market cap and good liquidity, so it naturally bears the brunt!
On-chain Evidence: During the crash, on-chain data clearly showed that someone on Coinbase dumped more than 5000 ETH in one go! Can retail investors do that? Clearly, it’s the big institutions urgently hedging and controlling risks.
Key details lined up:
At the precise moment ETH broke below $2500, it coincided perfectly with the plunge of the US stock market! Isn’t that enough to indicate the problem? This crash was brought down by 'Daddy' US stock market!
What to do after a crash? Keep a close eye on this 'big player's lair'!
The price is now hovering around 2363, this position is crucial! Why?
Historical Memory: In January this year, ETH repeatedly brushed against this area (2360-2380) forming a support level, like a psychological defense line.
On-chain Evidence: Even more hardcore, on-chain data reveals that in the range of 2360-2380, more than 450,000 ETH were accumulated! This is likely the cost area where the main force built their positions earlier. They don’t want to easily lose money breaking through here, right?
Brothers, tonight’s US stock market opening is the main event! If the US stock market can stabilize, ETH near this 'big player's lair' (2360-2380) is very likely to organize a rebound! But if the US stock market continues to slump, or if ETH breaks through 2360 with high volume... then we need to mentally prepare for a 'trip' down to 2300 or even lower! When the market is in panic, opportunities often hide in the bloody chips of others' liquidations, tonight, are you watching the market?
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