Event Review 📰

In the early hours of today, the ETH market experienced significant volatility, with prices undergoing rapid declines and brief recoveries within just a few minutes. The market began to see a massive sell-off triggered by technical factors starting at 01:20, with ETH prices plummeting from around $1612 to a low point, followed by a technical rebound at 02:25, rising back to approximately $1577. Meanwhile, U.S. macroeconomic data, trade policy uncertainties, and Federal Reserve Chairman Powell's live speech were released one after another, leading to a sudden shift in investor sentiment and intense short-term capital competition.

Timeline ⏰

• 01:20 – A sudden turn in market technicals: ETH prices began to rapidly decline from around $1612 (or close to $1603), forcing some positions to be liquidated, exacerbating selling pressure.
• 01:30 – Federal Reserve Chairman Powell appeared on time at the Chicago Economic Club, starting to elaborate on his views regarding economic trends, inflation pressures, and tariff impacts, increasing market uncertainty about future monetary policy.
• 01:44 – Real-time news and translations began to emerge, highlighting economic growth slowdown, potential persistent inflation from tariffs, and the need for more data before policy decisions, leading market sentiment to shift towards risk aversion.
• 01:45 – Market sentiment further deteriorated, with institutional funds starting to flow out, accelerating the ETH sell-off trend.
• 01:55 – A key low point emerged: ETH prices dropped to around $1538, as critical technical support levels were breached, triggering automatic stop-loss and liquidation effects.
• 02:25 – After a round of intense fluctuations, some buying interest stepped in, causing ETH prices to stabilize and rebound to around $1577.

Reason Analysis 🔍

The main factors behind this ETH crash are twofold:

1. Rising Macroeconomic and Policy Uncertainty

• Chairman Powell emphasized in his speech that tariffs could have a more lasting impact on future inflation, creating tension between dual mandate goals, which heightened investor concerns about the direction of future monetary policy.
• U.S. economic data and trade policies (such as tariff adjustments and changes in external economic policies) triggered market panic, leading funds to shift towards safe-haven assets, reducing risk appetite in the crypto market.

1. Market Capital Flow and Technical Breakdown

• As macro uncertainty intensified, some institutional funds faced outflow pressure in the ETF and spot markets, exacerbating ETH sell-offs.
• Technical indicators showed that after prices fell below key moving averages and support levels, a chain reaction of stop-loss orders was triggered, spreading the selling effect and resulting in a sharp decline in the short term.

Technical Analysis 📊

The technical analysis presented here is based on the 45-minute candlestick chart of ETH/USDT perpetual contracts on Binance, with the main observation indicators as follows:

• Bollinger Band Position: Prices had previously rebounded at the lower band, showing a short-term buy signal. However, after the subsequent price fell below the middle band, it turned bearish.
• OBV Indicator: The OBV crossed above the moving average and turned from negative to positive, indicating some buying power entering, but it failed to stop the overall downtrend.
• Moving Average Analysis:
• Current prices remain below the EMA20/50/120 moving averages, with EMA5/10/20/50/120 forming a clear bearish arrangement, indicating a strong downtrend.
• Although there are local bullish signals such as TD price reversals, the arrangement of EMA24 and EMA52 suggests that the medium to long-term trend remains bearish.
• Volume Changes:
• Trading volume surged by 118.86% in the last hour, accompanied by massive liquidations, with total liquidation amounts reaching approximately $6 million, of which long positions accounted for 87%.
• Large transaction data shows that main funds experienced a net outflow of nearly $10 million, indicating a clear phenomenon of active selling and capital withdrawal in the market.

Market Outlook 🌅

From the current market situation, ETH may seek to find a bottom near key technical support levels in the short term, with some technical buying expected to bring about a rebound. However, constrained by macroeconomic policy uncertainties, ongoing tariff concerns, and a cautious attitude from institutional funds, the medium to long-term trend remains weak.

Investors are advised to pay attention to the following points:

• Risk Control: During market fluctuations, it is recommended to reduce high-position operations, and to enter or reduce positions in batches as appropriate to lower the risk of drawdown.
• Technical Support: Closely monitor the dynamics of key moving averages (such as EMA20, EMA50) and volume fluctuations to prevent falling back into selling pressure after a short-term rebound.
• Macroeconomic Dynamics: Keep an eye on the Federal Reserve's subsequent policy direction and macroeconomic data, especially whether tariff and inflation signals are warming up, as this will directly impact market risk appetite.

Overall, the current ETH price is in a phase of adjustment and fluctuation, with a potential for local rebounds in the short term. However, if global macro uncertainties continue to escalate, the crypto market still faces significant downward pressure. Investors should remain cautious, closely monitor market sentiment and technical indicator changes, and adjust strategies to respond to potential volatility.

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