August 15, 2025 Market Analysis
Last night, the market experienced a brief sharp decline while the futures market saw a large amount of liquidations. Although this decline is not the largest pullback since Ethereum's launch, the liquidation volume is the largest. Therefore, it is necessary to analyze it carefully. From a price perspective, Ethereum's maximum decline was 7%, with a low point of 4450 USD, meaning that high-leverage bulls were directly wiped out. In fact, according to surf's liquidation data, the liquidation amount in the past 24 hours was about 1 billion USD, with bulls accounting for 80%. Furthermore, one-third of the liquidation volume was concentrated in the 4461-4551 USD range for Ethereum. In a certain sense, this is a strong counterattack from the bears and a life-or-death battle for the bulls, as the resistance around 4800-5000 is crucial. A breakthrough would open new space, while failure could lead to a stagnant situation and even the loss of new highs in the bull market.
From a temporal perspective, the decline yesterday was mainly influenced by the PPI data from the US. In simple terms, whether month-on-month or year-on-year, PPI showed an unexpected increase. Behind the PPI data is the core inflation data, which directly lowered the expectations for interest rate cuts in September. This is the key reason for the sudden flash crash in the market. Having identified the cause, I believe that this news-driven impact, in fact, serves as a relatively good pullback for the market. This indicates that the current round of sharp decline was not due to active selling within the circle but rather a market response to the PPI data, which simultaneously wiped out the recent enthusiastic bulls.
Another point is my personal judgment based on experience, which is that the liquidation volume threshold has not reached 1.5 billion USD. In this round, I will set several key indicators, one of which is the liquidation volume during a sharp decline in the bull market. 1.5 billion USD is a risk signal; if higher levels are reached, I will reduce my position significantly in advance. This round has not yet reached the risk value. At the same time, due to the market's high expectations for breaking through 4868 yesterday, it is often reasonable for the market to pull back and de-leverage at such times. Before the new high at 4868 points, combined with the PPI data, the main force conducted a round of long liquidation in advance to clear the resistance for the upcoming breakthrough, which I believe is the most likely scenario at present. A slight corroboration is that the price of BTC came back to around 120,000 when I was writing this article and did not break down.
Objectively speaking, the 1 billion liquidation volume this time should also be a cause for alertness. This is also the theory I mentioned yesterday; in the coming months, we will enter a phase of being bullish without taking large positions. If you haven't followed my rhythm to build a large position at the lows to prepare for the current bull market, you should definitely avoid blindly chasing the price up. A possible strategy to consider is to set up a regular investment plan or focus on arbitrage financial management. My personal plan is to reduce my position from 70% to 60% when the index reaches 5000 points. For instance, during yesterday's pullback, I managed to capture some segment gains, which is actually beneficial for my mindset. If it breaks through 5000, the subsequent reduction plan can continue, such as reducing 10% for every 1000 points increase. This way, when it reaches 10,000, I will still have a position, and combined with segment gains, the average reduction price of the entire position can reach 7-8000. This is just a personal plan, and everyone can set their own based on their expected returns and trading habits.
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