What happened to Ethereum's recent decline?
After Ethereum surged to around 3674, it suddenly dropped last night, falling below the 3600 mark during the day, attracting market attention. This wave of correction is actually a normal adjustment driven by multiple factors.
🔍 Core reasons for the decline:
1️⃣ Technical overbought correction
Ethereum has continuously surged in a short period, and the daily chart is severely overbought, with a high position doji star + upper shadow line combination, indicating clear technical pullback pressure.
2️⃣ Profit-taking by funds
A large amount of short-term funds has concentrated in the upper chip gathering area, heavily cashing out around 3670, and there is a lack of new funds to support in the short term, making the decline a natural trend.
3️⃣ Increased market risk aversion
Bitcoin has repeatedly encountered resistance around 120000, leading to a cautious overall market sentiment, combined with traditional market corrections, causing short-term funds to choose to exit for safety.
4️⃣ Macro variable disturbances
The Federal Reserve's interest rate cut expectations have been fluctuating, the US dollar index has strengthened in stages, and risk assets are under pressure, making it difficult for ETH, as a high beta asset, to remain unaffected.
📌 Conclusion:
This is not a “crash,” but a healthy technical adjustment. The trend has not been broken, and the support at the Bollinger middle line is effective. As long as the 3550~3580 area is maintained, there is still hope for a renewed rally.
📉 Opportunities often arise in panic; pullbacks are meant to allow for further progress.
Focus on the trend, adjust positions, and do not let short-term fluctuations disrupt your judgment.
