ETH surged from $3,700 on August 7 to $4,700 on the 14th, completing a nearly thousand-point rally in just one week. However, behind this wave of market movement, the main force is trapped in a 'riding a tiger' dilemma — the contract holding size skyrocketed from $29 billion to $60 billion, meaning its average cost has risen above $4,000, making the massive position an 'unshakeable burden.'
A liquidity trap with a dilemma on both sides.
The biggest contradiction in the current market lies in the 'dual-direction liquidity exhaustion.'
With sparse sell orders above, if the main force wants to continue increasing their position, it is likely to trigger a rapid breakout above the historical high of $4,877. However, the market consensus is unusually clear: three months ago, ETH was still hovering around $1,400; now at $4,700, retail investors are collectively waiting and no one is willing to chase the price higher. This 'cold at high altitudes' situation makes the main force hesitant to easily raise prices.
The buy orders below are also thin. If the main force wants to close out their $60 billion position, even a slight move could trigger a price avalanche. Once a panic decline occurs, high-leverage positions may trigger a chain liquidation, and the $4,000 cost line will become a death knell. Therefore, the main force can only choose to consolidate and oscillate, using time to exchange for space.
The main force's 'low-cost survival' strategy.
Consolidation is not passive waiting, but an active choice by the main force. The current core holding of $40 billion (calculated at 5x leverage) incurs a daily funding cost of only about $1 million (annualized at 5%). This cost is almost 'pressure-free endurance' for the main force.
More critically, the shorting behavior of retail investors is providing 'fuel' to the main force. Whenever there is a large number of high-leverage shorts in the market, the main force only needs to slightly oscillate within the range to trigger these short liquidations, both digesting the selling pressure and earning funding fees. This 'range harvesting' model allows the main force to maintain their position at an extremely low cost, even reducing their average cost.
Potential risks for short sellers.
Many retail investors are shorting based on the 'memory of $1,400' but overlook a key point: the main force's holding size determines that they must 'tough it out.' With a $60 billion contract market, if a consistent short position forms, the main force might choose to 'force a squeeze' — since liquidity is poor in both directions, instead of passively liquidating, it’s better to actively raise prices to trigger a chain liquidation of shorts, using the losses from the opposing positions to cover their own costs.
The more dangerous position is the low-leverage short. If the main force chooses to consolidate for half a month, the funding cost is only $15 million, yet it can exhaust those low-leverage shorts without stop-loss through time. Historical market trends have long proven: in a volatile market controlled by the main force, 'time' always stands on the side where the holding cost is manageable.
The current ETH market looks more like a 'war of attrition' trap set by the main force. Shorting seems to align with the 'fear of high prices,' but in reality, it has become a 'cash machine' for the main force to continue their energy. Before there is a clear breakout signal, what should be done is not to guess the top and short, but to see the main force's dilemma clearly — what they need is not a decline, but the panic short selling from retail investors to survive.
