Event Review 🔍

Recently, the price of ETH experienced a significant volatile market. Starting from 06:30, the ETH price encountered notable resistance around $2655, triggering a large number of stop-loss orders and a chain liquidation of leveraged positions, causing the price to quickly drop in a short period. At the same time, external geopolitical factors emerged in sync with market technical sentiment—some extreme tweets regarding the instability of the situation in Iran and regulatory policies also intensified the market's risk aversion sentiment. Overall, this volatility was driven by both technical chain reactions and panic induced by external political news.

Timeline ⏰

• 06:30: ETH faced significant resistance around $2655, triggering a technical correction, while extreme political rhetoric began to brew.
• 06:31: Extreme tweets (multiple accounts both domestic and foreign) called for "immediate evacuation from Tehran," causing risk expectations to rise rapidly.
• 06:39: Market data showed ETH price fell below the $2600 mark, and the market began to accelerate downward.
• 06:41: Within 11 minutes, the price plummeted from $2655 to about $2591, a drop of nearly 2.42%.
• 06:45: ETH price continued to retreat, dropping from about $2596 to $2540, with technical selling pressure further intensifying.
• 06:54: Some investors began to take profits, indicating a weakening confidence in the resistance around $2650.
• 07:09: A brief rebound brought the price back to around $2585, but overall it remained in a state of fluctuation and adjustment.

Reason Analysis 🔍

The sharp fluctuation in the ETH market was mainly driven by two factors:

1. Technical Correction and Chain Liquidation Effect
   The ETH price encountered resistance near $2650 and failed to hold this key support level, leading to a large number of stop-loss orders being triggered in the system, while some leveraged positions were liquidated, causing a chain liquidation effect. Large market sell orders frequently appeared, increasing the selling pressure and causing the price to decline further.

2. Geopolitical Risks and Policy Uncertainty
   The simultaneous emergence of extreme political rhetoric (related to the situation in Iran) and regulatory rumors caused investors' risk expectations to rise rapidly. Both institutions and retail investors tended to avoid external uncertain risks, further exacerbating the market's selling sentiment.

Technical Analysis 📊

Based on the 45-minute K-line data of Binance USDT perpetual contracts, observations of ETH/USDT show:

• EMA5 crossed below EMA10, forming a death cross signal, indicating increased short-term downward pressure.
• The RSI indicator broke below the 50 midline and continued downward, indicating weakened buying power.
• The price broke below the lower Bollinger Band and crossed down through the middle band, along with the %B indicator falling below 0, suggesting an enhanced oversold condition.
• The OBV indicator crossed below the moving average and fell below previous lows, showing a significant increase in selling power.
• Trading volume surged by 749.45%, accompanied by a rapid price decline, indicating a clear phenomenon of panic selling.
• The K-line pattern showed bearish engulfing and belt hold patterns, further reinforcing the technical signals of market weakness.

In summary, all technical indicators point to heavy selling pressure in the short term, with market sentiment trending pessimistic.

Market Outlook 🌟

In the short term, ETH is in a phase of technical correction, and market sentiment remains fragile. If the price fails to effectively recover the resistance level around $2650, it may continue to trigger some chain liquidations and panic selling. Investors should pay attention to the following aspects:

• Key Support Level: If the price can find support at a key level, it may trigger buying on dips; conversely, the risk of further declines increases.
• External Risks: Geopolitical and policy uncertainties are still brewing, and future market volatility should not be overlooked.
• Technical Indicator Observation: Subsequent attention should be paid to whether indicators like EMA, RSI, and OBV can show early reversal signals, indicating a potential short-term rebound in the market.

Overall, the current ETH market shows significant short-term adjustment pressure, and investors need to remain cautious, reasonably control their positions, and guard against risks brought by continued volatility. At the same time, some institutions may take this opportunity to layout volatility trading strategies, and the overall market risk needs further observation.

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