Reasons for the Crash
The geopolitical news that the military is inclined to reach an agreement with Hamas rather than occupy Gaza has triggered a certain level of risk aversion in the market. Although the direct correlation between the cryptocurrency market and traditional financial markets is not very tight, the instability of the global political situation can lead to a decrease in the overall risk appetite of investors. Some investors may shift funds from the higher-risk cryptocurrency market to relatively safe assets, such as gold, leading to a decline in the price of cryptocurrencies like ETH.
Technical Analysis
From the one-hour K-line chart of ETH, the price has shown a significant plunge, directly breaking through multiple support levels. The current price is at a relatively low level, with the RSI indicator near the oversold area, indicating that there may be some rebound demand in the short term. However, the MACD indicator shows that bearish strength still dominates, with green energy bars continuing to expand, suggesting that the downward trend may not be completely over yet.
News Front
In addition to the aforementioned geopolitical news, there are no significant positive or negative news within the cryptocurrency sector. However, the overall uncertainty in the financial market and the increased sensitivity of investors to risk make the price of ETH susceptible to external shocks. Attention should be paid to the further developments in the geopolitical situation and other news that may affect the market.
Personal Opinion
The recent sharp drop in ETH is mainly due to unexpected external news, representing a short-term emotional sell-off. In the long run, the fundamentals of ETH have not undergone substantial changes, and its technological development and application scenarios still hold significant potential. Therefore, this sharp decline is more a reflection of short-term market fluctuations rather than a change in long-term trends.
Future Strategy
Light position investors: If your position is light and you are optimistic about ETH in the long term, you can appropriately increase your position near the current price to lower your average cost. However, be cautious to add in batches to avoid investing too much at once. Heavy position investors: For those with heavy positions, it is not advisable to blindly cut losses at this time. You can consider reducing part of your position when the price rebounds to a key resistance level to lower position risk. Additionally, set a stop-loss level; if the price continues to drop and falls below the stop-loss level, decisive action should be taken. Observing investors: You can continue to adopt a wait-and-see attitude, waiting for market sentiment to stabilize and for the price trend to become clear before making decisions. Pay attention to subsequent technical indicators and market news to find suitable entry opportunities.
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