Currently, ETH is at a high of 4,332. It’s likely that both long and short positions have their own opinions. First, let’s talk about going long. There is no problem in going long for 1-2 points after a short-term rise and pullback at the current price. However, if considering chasing the long position at this level while waiting for ETH to hit a historical high, I think it is not very cost-effective.
Next, let’s talk about going short. Currently, brothers who are short have positions from 3,500 to 4,100. Looking at the liquidation map, it seems that very few shorts have been liquidated. Why is the price still continuously rising? First, we need to consider the intention of the market makers in this wave.
Personally, I believe that market makers are trying to find a high-level liquidity imbalance position. This rise, starting from 3,700, has already entered a long-short imbalance. There have been a large number of active long orders and passive liquidated short orders. Therefore, this round of market makers will definitely control the price to a position that has lost liquidity.
Every rise in the market is caused by short-sellers, similarly, every drop is caused by long positions. Market makers need to continuously withdraw quotes to raise prices until they find the next imbalance turning point. In summary, if short-sellers do not have a strong heart and excellent position management, it is advisable to stop loss and exit or open both long and short positions to ensure survival until market makers find the next imbalance point.
Next, let’s briefly discuss the trend of BTC. Currently, there is a key position that BTC needs to break through to turn bullish. The position is around 117,500. If it can successfully break through and stabilize, one can consider a right-side trade to go long. However, if it fails to break through this position for a long time, the overall outlook for BTC remains bearish. This is because the area around 112,000 is a high liquidity zone. Therefore, if there is another drop to the 112,000 area, it may trigger a long squeeze that directly breaks through this position to seek liquidity at the integer level of 110,000.
There has never been any so-called major player in the market. This surge in ETH also had almost no participation from spot orders; 90% of the trading volume comes from contracts. The entire cryptocurrency market can currently be understood as being composed solely of contracts. Therefore, in this environment, please do not analyze using your static indicator data. Do not look for support and resistance levels; instead, try to guess the liquidity position of the market from a different perspective.