Bull markets often have sharp drops, bear markets often have slow declines—ETH's drop from 4781 to 4226 is not a trend reversal, but rather a technical adjustment after profit-taking. The market now resembles a marathon runner who needs to catch their breath before deciding whether to sprint or rest.
1. Key signals in the market: the tug-of-war between bulls and bears has intensified.
Death cross warning:
The MA5 (white line) and MA10 (yellow line) are about to form a death cross, which is a signal of short-term weakness. If ETH does not hold above 4400 by the close today, it is likely to test the 4200 support level again.
Case reference: Last month, ETH similarly dropped from 4650 to 3980 within a week after the MA5 death cross; if it breaks down this time, a similar pattern may occur.
Reduced trading volume, weak rebound:
Today's trading volume is 760,000, below the 5-day average of 860,000, indicating a lack of enthusiasm from bottom-fishing investors.
Plain language interpretation: It's like a market selling at a discount—many onlookers but few willing to spend money, making it hard for prices to sustain a rebound.
Long lower shadow reveals main force's intention:
The 4-hour K-line at 4226 formed a long lower shadow, indicating that big funds are protecting the market around 4200, but the rebound to 4426 fizzled out, showing that the bears still have the upper hand.
2. News support: ETF expectations and US stock correlation.
Ethereum ETF progress (latest news):
There were rumors early this morning that the SEC may expedite approvals, but nothing has been officially announced yet. If it materializes, ETH could quickly challenge the 4600 resistance level.
Personal opinion: Such news often leads to 'buy the expectation, sell the fact.' When it is actually announced, the market may have already priced in the good news, so don't blindly chase highs in the short term.
Impact on US tech stocks:
If the Nasdaq drops significantly at the opening tonight (especially with heavyweights like Apple and NVIDIA), ETH is likely to fall as well; conversely, it may rebound if the Nasdaq goes up.
3. Practical strategies: How do different players play?
Short-term players:
The current price of 4426 is in the 'chicken rib zone'—limited upside potential and significant downside risk.
Actions: If it breaks below 4380, consider shorting with a light position, stop loss at 4430, and target 4250; if it breaks through 4450 with volume, then stop loss on shorts and wait.
Long-term holders:
Place buy orders in batches below 4200 and be bold to increase positions if it dips to 4000 (reference the historical rebound of 30% after the May crash).
Mnemonic: 'Don’t bottom fish during a crash, strike only when it dips', keep enough USDT for extreme market conditions.
Warning for contract traders:
Recent volatility has increased, and exchanges often spike prices in the middle of the night (like last week when ETH suddenly dropped to 3950 and bounced back), don't use leverage more than 3x to avoid liquidation.
Summary and hook
ETH currently resembles a 'compressed spring'—a lot of decline may lead to a rebound, but without new funds entering, the rebound will be hard to sustain. It's crucial to monitor two key positions.
Above 4450: If it breaks, then stop loss on short-term shorts; it may test 4600.
Below 4200: If it breaks down, panic selling may ensue, with the next psychological level looking at 4000.
Final hook:
"The market always bottoms in despair, rises in hesitation, and dies in madness"—The BoFu team specializes in serving ambitious lunatics! Follow BoFu to navigate the market through difficulties!
