Author: Deep Brother Talks Trends

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In the late-night cryptocurrency market, price fluctuations seem like a hungry beast, specifically devouring traders who have lost control of their emotions. Early this morning, ETH broke through $4,800, reaching a historical high of $4,887.5, with a 24-hour increase of over 14%, turning countless short accounts into ashes.

Just as the market was in a frenzy, the Ethereum Foundation once again became the focus. On August 24, the foundation transferred 35,000 ETH to an exchange.

Looking back at history, the foundation sold 35,053 ETH at an average price of $3,533 on May 17, 2021, after which the market experienced the '5.19 crash', where the price nearly halved. Similarly, on November 11, 2021, they sold 20,000 ETH at an average price of $4,677, after which the market began to decline continuously.

Early this morning, ETH reached a high of $4,887.5, breaking the previous high of $4,868 set in November 2021. However, after hitting a new high, it failed to hold steady and then fell back below $4,700.

This kind of high-and-low movement is worth being cautious about. From a technical indicator perspective, a top divergence risk has emerged at the daily level; unless it can stay above $4,450 this week, the death cross and divergence risk will be hard to eliminate.

The market is playing out a typical 'double kill' scenario: first blowing up the shorts, then pulling back to kill the longs. This tactic is a classic operation of major institutions, aimed at maximizing the harvest of retail investors' chips.

02 Main Force Psychology: The Art of Fund Management by the Foundation

The operations of the Ethereum Foundation have always been closely monitored by the market. The foundation's executive director explained that transferring ETH is part of its fund management activities. The foundation has an annual budget of about $100 million, mainly for grants and salary expenses.

Some beneficiaries only accept fiat currency, which requires the foundation to convert part of the ETH into cash. It is worth noting that after this transfer, the foundation still holds about 273,000 ETH, accounting for 0.25% of the total ETH supply.

The foundation has been jokingly referred to as 'the master of selling at the top' by the market because it has repeatedly sold ETH at market peaks. However, upon closer observation, the foundation's operations are not always precise 'top escapes'.

For example, selling 100,000 ETH at a price of $657 on December 17, 2020, and selling 28,000 ETH at a price of $1,790 on March 12, 2021, both missed the subsequent significant rise.

03 Technical Analysis: Key Points and Long-Short Lifelines

From a technical perspective, there are currently three key points in the market:

The neckline at $4,750: This is the top of the daily level 'rising wedge', and also the last defense line for the bulls. If broken, ETH will pull back to $4,550 (support from the MA60 moving average).

Pressure at the previous high of $4,850: In May 2025, ETH encountered 'massive selling pressure' at this position, and on-chain data shows that institutions were secretly offloading at that time.

Cost area at $4,550: The 4-hour chart shows this position is a 'smart money' accumulation zone; breaking below will trigger a chain of stop losses.

The MACD indicator shows that the dual lines are at a high dead cross, forming a top divergence situation. Unless the price can quickly return above $4,450, the risk of divergence will be difficult to eliminate.

04 On-Chain Data: Large Transfers and Institutional Movements

In addition to the Ethereum Foundation transferring 35,000 ETH, on-chain data also shows other large liquidity movements. Since the listing of the Ethereum ETF on July 23, a certain fund's ETH product has seen a cumulative net outflow of 799,000 ETH, with an average daily net outflow of 32,000 ETH.

In contrast, the 35,000 ETH transferred by the foundation this time is not particularly significant. However, from the perspective of market sentiment, the foundation's actions are often seen as a signal that influences investor psychology and market expectations.

Exchange data shows that the long position volume of ETH surged by $2.1 billion in a single day, but the MACD line has shown 'top divergence', indicating that the market may be overheating, increasing the risk of a pullback.

05 Tonight's Trend Prediction: The probability of a decline is greater than that of an increase.

Based on current technical and fundamental analysis, the probability of a decline tonight is greater than that of an increase. The reasons are as follows:

First, there is a technical divergence at the top that requires a pullback to correct the indicators.

Second, the foundation's transfer of ETH to exchanges has increased the expectation of selling pressure.

Third, market sentiment is overly fervent, with a surge in long positions, which is usually a contrarian indicator.

The key support level is in the $4,550-$4,600 range; if it breaks below this area, it could trigger a larger-scale adjustment. On the upside, only by regaining stability above $4,850 can it continue to advance.

06 Operating Strategy: Protecting Capital Safety First

For traders in different situations, the following strategies are recommended:

For those with no positions: Stay patient and wait for a pullback to the $4,550-$4,600 range before considering building positions in batches to avoid chasing highs.

Long position holders: Set dynamic take-profit levels, such as considering reducing positions if it falls below the EMA12 moving average, to protect existing profits.

Short position holders: Use the 'batch averaging down method', adding 1/3 of the position for every 50-point decline to lower costs, but be sure to set stop losses.

Key Point: Regardless of the market direction, do not operate with all your capital, keep a certain cash position to respond to unexpected situations.

In the face of market fluctuations, maintaining calm and discipline is key to survival. As Ethereum founder Vitalik Buterin said, the budget strategy of the Ethereum Foundation is to spend 15% of remaining funds each year, meaning its influence in the ecosystem will diminish over time.

The market will never lack opportunities; what often lacks is patience and the courage to wait for the right moment. Tonight, regardless of how the market fluctuates, maintaining your trading discipline and risk threshold is more important than short-term profits.

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