Event Review 🚨
Recently, the ETH market has experienced intense volatility. Starting around 23:10, positions of some institutions and high-leverage traders were liquidated, triggering panic selling in the market and causing a rapid release of liquidation effects. In a short period, the price of ETH hovered around $4,000, then plummeted by more than 3% in less than an hour. This round of market movement not only reflects the concentrated outbreak of inherent market risks but also mirrors the external shocks brought by macro policy uncertainties.
Timeline ⏱️
10-16 23:10
Initial market turbulence appeared, with ETH prices fluctuating in the $4,000–$4,020 range; some high-leverage positions began facing liquidation risks, and initial signals of panic selling were released.10-16 23:56
In just 46 minutes, the price of ETH plunged from $4,019 to $3,890, a drop of about 3.22%. This was mainly due to large long positions triggering a chain of liquidations, resulting in a sudden decrease in market liquidity.10-17 00:25
Under continued selling pressure, the price of ETH further dropped from around $4,002 to $3,866, then slightly rebounded to about $3,880.48. During this period, external macro factors intertwined with internal liquidation effects, significantly amplifying price volatility.
Reason Analysis 🔍
The sharp market fluctuations mainly stem from two factors:
High-leverage position liquidations triggered chain reactions
Multiple institutions and high-leverage traders suffered liquidations during the price correction, and consecutive liquidations released massive selling pressure, causing market liquidity to dry up rapidly. In a short time, hundreds of millions of dollars in long positions were closed, dragging ETH prices down sharply and creating a clear chain reaction.Macro policy uncertainty intensified market risk aversion
External factors such as government shutdown risks, expectations of interest rate cuts, and other policy transmission uncertainties led to a sharp decline in market risk appetite. Influenced by these uncertainties, investors chose to close positions to avoid risks, further spreading panic selling and accelerating the price decline.
With the interaction of these two major factors, both the structural selling pressure from liquidations and the market sentiment downturn triggered by external macro risks jointly drove the sharp short-term drop in ETH.
Technical Analysis 📊
Based on Binance USDT perpetual contract 45-minute candlestick data, the current technical outlook shows clear bearish signals, as follows:
Oversold indicators and KDJ observation
The current J value is in an extremely oversold region, and the KDJ indicator shows a divergent trend, suggesting a possible short-term rebound opportunity, but the overall downward momentum remains strong.OBV changes and abnormal trading volume
The OBV indicator has broken below previous lows and turned negative, indicating that selling power continues to strengthen. Meanwhile, trading volume has surged by 190.85%, and there is a divergence between price and volume, showing the market is in a state of panic selling. The current trading volume is not only significantly higher than the 10-day average but also ranks in the top 10% of recent cycles.Moving average system and MACD trend
The price is currently below the MA5, MA10, MA20, and MA50, with moving averages arranged in a bearish pattern; at the same time, all EMAs (including EMA5/10/20/50/120 and EMA24/52) show a strong downward trend. The MACD histogram continues to shrink, reflecting strengthening downward momentum, and the short- to mid-term technical trend remains weak.Liquidations and large transactions
Recent statistics show that in the past hour, the total amount of liquidations across the network was about $10 million, with long positions accounting for as much as 94%. The main net outflow of funds was about $4 million, further confirming the huge selling pressure and lack of liquidity in the market.
Market Outlook 🔮
Although ETH is currently under strong downward pressure due to high-leverage liquidations and macro uncertainty, some technical indicators (such as the extremely oversold region) suggest that a technical rebound may occur in the short term. Future trends should focus on the following aspects:
Key support level observation
Investors should closely monitor the important support level around $4,000 and changes in trading volume to determine whether panic selling has come to an end.Macro policy and market sentiment
As government shutdown risks, expectations of interest rate cuts, and other macro factors continue to ferment, market risk aversion may persist in the short term. Investors should implement risk controls to avoid chasing highs.Liquidity recovery and long-short dynamics
If the market structure improves and liquidity recovers, it may lay the foundation for a rebound. However, as long and short forces continue to alternate, investors are advised to remain cautious, closely tracking the subsequent impact of the liquidation wave.
Overall, the current sharp volatility in ETH serves as a warning to the market. In a time when risks and opportunities coexist, investors should pay attention to internal liquidation data and external policy developments, adjust positions in a timely manner, and seek more stable trading opportunities amid future volatility.
