#ETH Ethereum (ETH) has recently performed remarkably, with the price strongly rebounding from the key support level near $2750, breaking through the psychological barrier of $3000, and reaching a high of $3040 at one point. However, as market sentiment approaches an overbought state and several technical and on-chain indicators begin to show pressure signals, the correction risk in the short term needs to be taken seriously. The following is an analysis of the short-term price correction risk for Ethereum.

Technical signals

1. Overbought and technical correction pressure

  • The KDJ indicator shows that Ethereum is currently in the 'overbought zone,' with the J value extremely overbought, which usually indicates that the short-term price may face some correction risk.

  • Although the RSI formed a double bottom pattern and broke above the 50 midline again, the rapid rise increases the likelihood of a weakening trend. If the RSI continues to rise above 70, a significant adjustment signal will appear.

  • At the same time, the current price of Ethereum has formed a 'double top' candlestick pattern in the 30-minute cycle, indicating that there is strong resistance in this area, making it difficult to break through easily.

2. Important support and resistance levels

  • According to the chip distribution, the recent support level is around $2900, only about 0.05% from the current price, which is an important defense line. If $2900 is broken, it may test the 4-hour support level at $2866.

  • In terms of resistance levels, while $3000 has stabilized, there are still many trapped positions above that need to be digested, especially around the significant resistance at the local high of $3040.

3. Changes in trading volume and momentum

  • Currently, the 20-day average trading volume has decreased by 16.60%, indicating that market activity has weakened, and high-level funds lack the ability to further drive price breakthroughs. Meanwhile, the MACD has previously formed a death cross below the zero axis, suggesting that short-term bearish momentum may still be intensifying.

Analysis of large transactions and major orders

1. Large transaction net outflow

  • In the last 72 hours, the statistics on large transactions show a total buying amount of $17.67 million and a total selling amount of $21.98 million, showing a 'net outflow' status, amounting to $4.31 million, indicating that the short-term forces lean towards bears.

  • The two largest sell orders occurred near $2959 and $2949, with a total amount exceeding $13.5 million, which evidently suppressed the price's upward space.

2. Major orders balanced but lack of follow-up willingness

  • The buying and selling power of major orders is basically balanced, with $1.258 billion bought and $1.148 billion sold in the last 72 hours. However, from the specific data, some large orders are concentrated in the $2770 to $2990 range, indicating that the market is evidently becoming cautious as it approaches $3000, with no strong signs of major funds entering to drive the price up.

Fundamentals and macro background

1. Expectations for Ethereum ETF and regulatory uncertainty

  • The current market's optimistic sentiment regarding the U.S. SEC's approval of a spot Ethereum ETF is one of the important factors supporting the price. However, the uncertainty of regulatory decisions always hangs like a sword of Damocles. Any delays or negative news could trigger a rapid reversal in investor sentiment, leading to a wave of selling.

2. Potential volatility of the macroeconomic environment

  • Although global interest rate cut expectations pose potential benefits for high-volatility assets like Ethereum, the Federal Reserve's policies remain complex. If macroeconomic policies tighten more than expected in the future, risk assets may face significant downward pressure, which could also affect ETH's short-term trends.

Correction risk assessment

1. Major risk points

  • Technical signals such as the KDJ indicator being overbought, the double top pattern, and the MACD death cross indicate that an adjustment may be imminent.

  • In terms of funds, the situation of large transaction net outflows and some major orders showing signs of stagnation also strengthens the possibility of short-term pressure.

  • From a fundamental perspective, the uncertainty regarding the U.S. SEC's approval of the ETH ETF and external risks in the macro economy still exist.

2. Possible price correction range

  • If ETH cannot effectively hold the $2900 support level, the next step may test the $2866 area or even lower, as these two price levels are key supports in the recent period.

  • During the downward process, attention should also be paid to the short-term strong support level around $2850, which corresponds to the effective retracement point of the last rebound.

3. Positive aspects of risk alleviation

  • Although there is some short-term correction risk, Ethereum's historical experience indicates that each adjustment often provides a strong bullish opportunity for re-entry. If ETH can establish a solid foundation above $2900 and gain more support from major players, it is still expected to quickly recover recent gains.

Comprehensive judgment

Ethereum's recent crazy breakout to $3000 proves the market's recognition of its long-term value and ecological prospects. However, short-term volatility is increasing, and the correction risk is gradually rising. Investors are advised to closely monitor the key support at $2900 and the technical retracement area below. If these levels can be effectively defended without any major negative external factors, the subsequent performance is still worth looking forward to. However, any investors wishing to engage in short-term operations should combine market guidance to avoid blindly chasing highs.