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The cryptocurrency market is flooded with blood, with over 260000 investors selling out within 24 hours. Ethereum has fallen below the critical psychological barrier of $4000, and a long short battle is unfolding regarding the support and hope of a rebound at $3700.
Ethereum plummeted by over 6% in the early hours of September 26th, hitting a low of $3820. This is a drop of over 20% compared to the historical high in August, which meets the definition of a technical bear market.
According to Coinglass data, the total amount of online liquidation in the past 24 hours reached 1.202 billion US dollars, including 1.09 billion US dollars for multiple liquidation and only 110 million US dollars for short liquidation.
The current decline is not only sufficient for individual phenomena in Taifang, but also a collective correction in the entire cryptocurrency market. Bitcoin has fallen below the $110000 mark for the first time in four weeks, with mainstream currencies such as Solana, BNB, and XRP experiencing a general decline of over 6% in the past 24 hours.
Market panic is spreading, and risk assets are generally experiencing sell offs. More speculative tokens such as Dogecoin and Cronos experienced larger declines, plummeting 9.4% and 10% respectively.
The slowdown in institutional capital inflows is one of the main reasons for Ethereum's decline. Since Monday, investors have withdrawn nearly $300 million from Ethereum exchange traded funds listed in the United States.
【 02 Key Support: $3700-4000 Life and Death Line 】
At present, the market focus is on the price range of 3700-4000 US dollars, which will become the key factor determining Ethereum's short-term trend.
According to Coinglass data, if the price of Ethereum falls below $3700, it could trigger a long liquidation of up to $408 million; If it breaks through $4000, it may trigger a short liquidation of $1.208 billion.
This asymmetric liquidation pressure reveals the fragile equilibrium of the current market. The liquidation risk faced by bears is actually three times that of bulls, which means that once the price exceeds $4000, it may trigger panic buying by bears.
IG Australia analyst Tony Sycamore said, "If we see Ethereum closing below $4000, the next stop will be between $3700 and $3500
【 03 Technical Indicator: Coexistence of Downward Signal and Rebound Hope 】
From a technical analysis perspective, the trend of Ethereum is not optimistic. Ethereum has confirmed that it has fallen below the symmetric triangle support pattern, which is a bearish reversal signal.
At present, Ethereum has fallen below the 20 day and 50 day moving averages, with the 100 day moving average becoming the last line of defense. If the downward trend cannot be stabilized here, there may be a backtesting of the $3400 range near the 200 day moving average in the future.
However, some potential positive signals are also beginning to emerge. The Ethereum holdings on the exchange have dropped to about 16.3 million, hitting a nine-year low.
The Relative Strength Index (RSI) is approaching the oversold range, with a value close to 22. The market generally believes that there is room for a technical rebound in prices.
【 04 Whale Trends: The Layout Signal of Smart Money 】
Blockchain data shows that giant whales are quietly taking action. In the past 24 hours, a total of 10 new wallets have purchased over 200000 Ethereum coins, with a market value of approximately $800 million.
Large coin holding addresses have begun to actively layout below $3700, and the net outflow volume of the exchange has also reached a recent high. These signs indicate that large funds are preparing for possible market fluctuations.
Market analyst Cold Blood Shiller pointed out that Ethereum's weekly chart shows that the price is retesting the key level support area around $3800-4000. Successfully maintaining this level will enhance the possibility of bullish continuation.
In the coming days, investors should closely monitor the effectiveness of the $3700 support level. If this defense line falls, the next key support level will be in the range of $3400 to $3600.
Analyst Kamran Azghar pointed out that the area around $3600 is a "critical demand" zone, and if held, ETH prices may rebound to $4900 or higher.
The outcome of the game between long and short in the $3700-4000 range will determine the short-term direction. The market is in a state of extreme fear, but this emotion often breeds opportunities as well
Operation suggestion:
BTC 108650 long first target watch 109850 second target watch 112765;
ETH 3850 long, first target 3980, second target 4100.
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Disclaimer: The above content only represents the author's personal opinion and is intended to assist investors in understanding information related to the capital market. It does not constitute any investment advice and does not represent the position or viewpoint of AiCoin. The market is risky and investments should be made with caution.
