I’ve been navigating the crypto space for ten years, and today I’ll use the most straightforward language to break down the key trends in the recent Ethereum market. The competition over Ethereum has intensified, and everyone's eyes are focused on the whale address 0x8c58—this big player’s holding movements have become a market barometer.

According to on-chain data tracking, on July 12, 0x8c58 deposited 3.74 million USDC into the Hyperliquid platform and directly opened a 15x leverage short position, shorting 18,394 ETH. The current value of this position has skyrocketed to 54.3 million USD. This operation has caused quite a stir in the circle; why? Because this position is simply too large, and the leverage is frighteningly high.

The most critical issue now is that if the price of Ethereum continues to rise, the whale's liquidation risk will increase sharply. Once forced liquidation is triggered, it could lead to a 'short squeeze'—simply put, when shorts are forced to close their positions, buying pressure will further push prices up, creating a vicious cycle. At this point, it becomes a signal for retail investors to act in reverse, as many are waiting to pick up bargains when whales get liquidated.

First level of risk: Shorting at 15x leverage is equivalent to dancing on the edge of a knife.
This whale is shorting ETH with 15x leverage, equivalent to betting their life savings on a price decline. According to futures trading rules, as long as the ETH price rises to their liquidation point, the system will automatically close the position. The most critical issue now is that if their liquidation price has already fallen below the current market price, then every rise in price feels like stepping on a landmine—once triggered, forced liquidation will cause the platform to buy ETH frantically to cover the short position, which will push prices even higher. This is what is referred to in the circle as the 'short squeeze' effect, akin to a domino collapse.

Second signal: Market sentiment is extremely heated.
Recently, the cryptocurrency fear and greed index soared above 70, indicating that the entire market is in a 'greedy' state, and everyone is chasing the rise. At this time, whales are acting contrary and shorting, like singing against the tune during a festive celebration. However, historical experience tells us that when most people are bullish, massive short liquidations can actually become a catalyst for speeding up the market. For instance, last year when Bitcoin surged to 69,000, several large shorts getting liquidated directly pushed the price to new highs.

Third driving force: Institutional funds are stoking the fire.
Institutions are now frantically buying ETH: BlackRock's Ethereum ETF alone saw an influx of 499 million in a single day, setting a record; SharpLink Gaming, BitMine, and other corporate giants combined bought over 124,000 ETH, valued at 420 million USD. This large capital and the whale’s short positions form a hedge, like two elephants in a tug-of-war. Once the price breaks through a certain critical point, institutional buying could flood through the short defenses, leading to a chain reaction triggered by whale liquidations, which might be a good opportunity for retail investors to pick up bargains.

Technical aspect: ETH is on a relentless rise, and the bulls are having a blast.
ETH just broke through the 3600 mark yesterday, rising 21.7% over the week, hitting a new high since the start of 2025. The price is now firmly above 3500, with the next target aiming for 4000 (which is the highest point of 2024). Looking at the technical indicators:

MACD: Although the bearish side still dominates, the bulls are fighting back, like two armies in battle; while the shorts are temporarily leading, they lack stamina.

RSI: The short-term rise is a bit too fast (over 70), but the overall trend is still upward. A slight pullback could actually present a good buying opportunity.

Support levels: 2835 (recent low), 3057 (previous resistance now turned support).

Resistance levels: 3600 (just broken), 4000 (psychological barrier).

On-chain data also reveals key signals:

Exchange reserves: The amount of ETH on exchanges is decreasing, reaching a five-year low. With scarcity comes value, making it difficult for prices not to rise.

Whale holdings: Besides the 0x8c58 address, other whales have recently transferred over 146,000 ETH to exchanges, yet the price continues to rise against the trend, indicating strong market absorption and resilience against sell-offs.

Fundamentals: Driven by both policy and technology, ETH has strong backing.
Major positive news from the policy front:

On July 17, the U.S. House of Representatives passed the (GENIUS Act) and (CLARITY Act), providing 'insurance' for digital assets and clarifying the regulatory framework, shifting some regulatory authority from the SEC to the CFTC. This is like giving the market a reassurance shot, making institutional funds more willing to enter and allocate ETH.

The technical aspect is continuously upgrading:

Layer 2 expansion: Arbitrum Nova has surpassed 120 million transactions daily, with L2 networks like Optimism and Base attracting a large number of users and funds, making the ETH network increasingly smooth and user-friendly.

Staking economy: The ETH staking rate has risen to 43% (35.6 million ETH), with an annual yield of around 5%. Institutions are more willing to hold ETH long-term, leading to an increasing amount of ETH being locked up, resulting in less ETH circulating in the market, further reinforcing the expectation of 'scarcity raises value.'

The derivatives market also shows bullish dominance:

Binance data shows that the ETH/USDT long-short ratio has risen to 1.0255, with top traders’ accounts reaching a long-short ratio of 2.3772, indicating heightened bullish sentiment.

In the past week, the amount of ETH futures shorts that got liquidated reached 438 million USD, far exceeding the longs at 211 million, significantly weakening the short side, as if they were knocked down.

First, how to manage entry timing and position size.

Aggressive play: If ETH pulls back to the 3400-3500 range (which is the support level of the 30-day average), you can try a light long position, setting the stop-loss below 3300, aiming for 3800-4000. It’s like catching a flying knife; be quick and sharp, and don’t be greedy.

Conservative play: Wait until the price effectively breaks through 4000 USD before chasing long, with the stop-loss referring to 3800 and aiming for 4600 (the historical high point of 2021). It's like waiting for the bus to confirm it has arrived before boarding; it’s safe but you might miss the first bus.

Second, how to hedge risks and allocate funds.

Options protection: You can buy call options to insure the spot long positions or use combination strategies (like bull spreads) to lower holding costs. It’s like buying insurance for a house, so you can minimize losses in case of a fire.

Diversified investment: Don't put all your money into ETH; at most allocate 30% of your crypto assets to ETH, and the remaining funds can be used to invest in L2 tokens (like ARB, OP) or DeFi blue chips (like UNI, AAVE). It’s like not putting all your eggs in one basket; if one basket falls, you won’t lose everything.

Third, beware of these black swans.

Policy variables: If the (GENIUS Act) requires stablecoins to migrate to federal chains, it could temporarily impact the ETH ecosystem. It’s like suddenly saying you need to change your driver’s license; you have to readjust to the rules.

Technical failures: If L2 networks (like Arbitrum) experience security vulnerabilities or scaling delays, it could trigger a liquidity crisis. It's like suddenly having roadwork on a highway, causing a massive traffic jam.

Macroeconomic factors: If the Federal Reserve delays interest rate cuts or geopolitical conflicts escalate, it could lead to a broad decline in risk assets. It’s like a sudden change in weather; you have to bring an umbrella when going out.

Fourth, whale liquidations could become a catalyst for the bull market.
The big player 0x8c58 is shorting ETH with 15x leverage, and this 54.3 million USD short position is like a ticking time bomb. Recently, institutions have been buying ETH like crazy, with two major U.S. bills providing support, and the technical aspect has also broken through critical resistance levels—under these three favorable conditions, whale liquidations might actually become a catalyst for ETH's rise.

How should retail investors operate?

Watch for two signals: If the ETH price stabilizes above 3600 and rumors of giant whales getting liquidated start circulating, decisively follow up with a long position, as it is likely to catch a wave of rising profits.

Pullbacks are opportunities: If ETH experiences a short-term pullback, don’t rush to cut losses; instead, you can view it as a good opportunity for medium to long-term positioning. It’s like bargaining at a vegetable market; the drop is when you can pick up bargains.

Lastly, let me say a blunt truth.
In this highly volatile crypto market, controlling position sizes, strictly setting stop-losses, and having respect for the market are the keys to survival. Don’t be fooled by ETH's current surge; a policy change or technical failure can reverse the trend. Remember: those who survive long in the crypto space are the real winners.

#山寨季何时到来？ #以太坊连续两日领涨 #币安HODLer空投C

$BTC$ETH