The Truth Behind ETH's Midnight Plunge: Is the $4000 Support Level About to Break?!! Is it a Signal of a Crash or a Golden Pit?!!!

News: Three Major Bad News Hit, Market Sentiment Takes a Sharp Turn

Last night, ETH suddenly plummeted, dropping 5% in a single day to around $4100, driven by a triple blow of news:

Federal Reserve's "Hawkish" Stance Scares Off Funds: U.S. inflation data for July exceeded expectations, causing market expectations for a rate cut in September to plummet from 80% to 50%. Nasdaq tech stocks fell 1.2% in response, and Bitcoin dropped to $113,000, bringing down the entire crypto market.

ETF Fund "High Dive": On August 18, ETH ETF saw a net outflow of $245 million in a single day, the largest single-day withdrawal in nearly a month. Institutions like BlackRock and Fidelity may be locking in profits, leading to a surge in short-term selling pressure.

Regulatory "Cold Arrow" Surprise: New York State proposed a 0.2% tax on crypto transactions, directly hitting retail investor sentiment; combined with the sentencing of the Tornado Cash founder, the privacy coin sector collectively plunged by 10%.

Technical Analysis: $4000 Becomes the Line of Life and Death, Is a Rebound Imminent?

From the candlestick chart, ETH broke the key support level of $4100 last night, but technical indicators hide some secrets:

RSI Divergence: When prices hit new lows, RSI did not break its previous low, suggesting that selling pressure is exhausted, with over 60% probability of a rebound from oversold conditions.

Bollinger Bands at the Bottom: The price reached the lower band on the 4-hour chart, indicating a possible technical rebound in the short term.

Whale's "Secret Move": Although early participants transferred 19 million ETH to exchanges, on-chain data shows that these ETH have not been directly sold, possibly for institutional portfolio rebalancing, indicating unchanged long-term bullish intent.

Special Analyst's Exclusive View: Short-term Washout, Long-term Golden Pit

Last night's plunge is essentially profit-taking after good news realization:

On August 7, the U.S. allowed 401(k) pension plans to invest in crypto assets, which is a long-term positive for ETH, but short-term funds took profits on the news. Technically, $4000 is the dividing line between bull and bear; if it holds, the upward trend will resume, targeting $4800; if it breaks, it may retest $3800 before rebounding.

Action Suggestions:

Short-term Players: Take small positions near $4100 for a rebound, set stop-loss at $4050, target $4200-4300.

Long-term Players: Build positions in batches, adding every 5% drop below $4000, targeting $5000.

The crypto market has never lacked "plunges", but what it lacks is "calm after the plunge".

Special Analyst's Scythe is Faster than the Market Makers! Follow me to learn how to cut the market back! #ETH