On the morning of August 26, ETH experienced a "frightening flash crash" — plummeting from $4690 to $4311, with 210,000 people liquidated and $1.047 billion evaporated. Was this "bloodbath" an inevitable technical correction or a sudden negative news attack? Understanding the underlying logic clearly is essential to determine whether ETH will stage a counterattack or continue to fall into the abyss!

1. The technical indicators have already warned: 4295 has been breached, bears have completely taken control.

Don't be fooled by the sudden crash; the "crash signal" on the 4-hour K-line had actually shown signs earlier, only masked by previous fluctuations:


  1. Key support turned into resistance: $4295 was supposed to be the recent "pullback bottom line"; it rebounded in the previous three tests, but was forcefully breached by bears in the early morning, triggering programmatic sell orders and a chain reaction of leveraged liquidations — long positions exited on stop losses, further amplifying the drop. Now, $4295 has changed from a "support level" to a "rebound roadblock"; to warm up in the short term, it must first reclaim this position;

  2. The trend line has completely collapsed: the descending trend line connecting the two previous highs at 4680 and 4515 already hinted at "weakness in the rise," and this crash directly broke below the lower edge of the trend line, indicating the end of "consolidation" and that bears officially dominate the market;

  3. All indicators are flashing red: the BOLL band has widened, and prices have dropped below the lower band; the 20-day EMA ($4670) has changed from support to resistance, with moving averages showing a bearish arrangement; the RSI index has dropped to 27; although there are oversold signals, there are no signs of "stopping the drop and stabilizing" in the short term — the technicals have entered a "short-term bear market mode."

2. Triple negative news: The Federal Reserve's change of stance, institutional withdrawals, regulatory pressure.

The early morning crash was not a technical "lone battle," but the result of three major negative news events exploding simultaneously:


  1. The Federal Reserve's interest rate cut expectations have dramatically reversed: Powell seemed to mention a "rate-cutting cycle" at the Jackson Hole annual meeting, but the market interpreted it as "less forceful than expected" — the probability of a rate cut in September plummeted from 98% to 15%! It’s important to note that the core logic behind ETH's recent rise is "liquidity easing"; now that easing expectations are cooling, high-risk assets are the first to be sold off.

  2. ETF funds are staging a "major withdrawal": ETH spot ETF saw a net outflow of $196.6 million this Monday, directly reversing last week's record inflow of $2.8 billion; Bitcoin ETF also turned negative — institutions that previously shouted "long-term allocation" are now quietly taking profits, shattering market confidence.

  3. Regulatory swords are still hanging overhead: Hong Kong's (stablecoin regulations) have been officially implemented, raising compliance costs; the US SEC has delayed the approval of altcoin ETFs, coupled with Trump's tariff policies causing global trade fears, the US Nasdaq dropped 0.9%, and ETH, which is strongly correlated with US stocks, naturally fell.

3. Exclusive judgment: In the short term, watch the battle at 4295; the long-term potential of $8000 is still there.

After the crash, don’t rush to "cut losses" or "buy the dip"; looking at it from both short-term and long-term perspectives makes it clearer:

1. Short-term (within 1 week): 4295 is the "line of life and death"; 4000 is the final defense line.

  • If it can quickly recover $4295, and the trading volume increases during the rebound (for example, exceeding $250 million in one hour), it indicates that buying funds are entering, and in the short term, it could rebound to $4450-$4550;

  • If $4295 cannot hold, the next step will test the psychological level of $4000 — this position is the "dense cost zone" before the DeFi ecosystem exploded in 2025, where many institutions and retail investors built positions nearby; it is very likely there will be buying support, and it won’t drop directly;

  • The key variable is the Federal Reserve's September interest rate decision: if they ultimately cut rates by 25 basis points, it could alleviate liquidity concerns, and ETH might bottom out and rebound; if they pause the rate cuts, it will take some more time.

2. Long-term (3-6 months): The fundamentals support it; $8000 is not a fantasy.

Short-term fluctuations may be fierce, but they do not change ETH's long-term value logic:


  • Institutions are "secretly increasing positions": BlackRock and Fidelity's ETH trust holdings are still surging. Once the SEC approves the ETH spot ETF, traditional funds (like pensions and sovereign funds) will have a clear entry path, and this amount of capital far exceeds that of retail investors;

  • Technical upgrades are imminent: After the activation of the EIP-5005 protocol, ETH block processing speed can reach 3000 transactions per second. Layer2 (Arbitrum, Optimism) daily trading volume has reached new highs, and the improvement in ecological efficiency will bring real demand;

  • The macro logic remains intact: The real yield on US Treasuries has dropped to -1.3%. ETH, as a "deflationary asset" (burn mechanism + staking), is increasingly showing its allocation value. Morgan Stanley even predicts that by 2030, ETH's market cap could reach 80% of BTC's.

4. Operational suggestions: Don’t be greedy in short-term trial and error; gradually build positions for the long term.

Provide clear strategies for different investors; don't be swayed by emotions:


  1. Short-term investors: Lightly test long positions near 4295; set a stop-loss at $4150 (only taking on $145 risk), aim to take profits at $4450-$4550 — don’t be greedy saying "it can reach 4600," there’s still short-term resistance; take profits while you can.

  2. Long-term investors: Now is the time to gradually accumulate spot positions, even participate in ETH staking (currently yielding 3%-4% annually) — based on the NVT ratio, ETH's current price is at a historical low, and this undervaluation won’t last long.

  3. Everyone should be cautious: don't open high-leverage contracts! Currently, the long-short sentiment is extreme; with 10x leverage, any fluctuation can lead to liquidation; preserving capital is more important than "betting on a rebound."

5. The ultimate question: Will ETH become the "crypto version of Nasdaq"?

Despite the short-term crash, ETH's fundamentals are much stronger than in the 2021 bull market:


  • Institutional participation: ETH spot ETF holdings have reached 832,000, far exceeding the 600,000 of Grayscale's BTC trust in 2021.

  • Ecosystem prosperity: DeFi locked value has surpassed $80 billion, and the daily trading volume of NFTs exceeds $120 million; real usage demand has replaced "pure speculation."

  • Policy friendliness: The EU's MiCA regulations classify ETH as a "technical asset"; the US SEC has relaxed restrictions on institutional holdings, and regulatory risks are gradually being cleared.


Therefore, this round of crash is more likely a "pullback within a bull market" rather than a trend reversal. If the 4295-4000 range can hold, ETH is very likely to return to $5000 in Q4, and breaking $8000 in 2026 is not a fantasy either!
Follow me; I will continue to track ETH rebound signals and institutional movements, helping you avoid crash pitfalls and seize buying opportunities, together facing the next wave of market! Feel free to discuss your thoughts in the comments.#加密市场回调