$ETH I still have confidence in 8500....

Ethereum has recently seen a significant rise, stabilizing above $3,000, pushing the total market capitalization of cryptocurrencies to over $3.2 trillion.

Core driving factors

1. Release of technical upgrade dividends

The upcoming Fusaka upgrade for Ethereum has become a key catalyst. This upgrade will increase the Gas limit to 40 million, and the Layer 2 network throughput is expected to double, directly enhancing the ecological carrying capacity. On-chain data shows that in the past two weeks, the amount of code submitted by developers has surged by 62% year-on-year, with the frequency of core protocol updates reaching an average of 3.2 times per day, and technical activity hitting a new high for the year.

2. Short squeeze effect

After Bitcoin broke through $93,000, it triggered $430 million in short liquidations (of which ETH-related liquidations accounted for 28%), leading to strong buying in the derivatives market. The funding rate for perpetual contracts turned positive to 0.025%, with the total open interest reaching $14 billion, and leveraged trading driving price volatility.

3. Continuous institutional capital inflow

The U.S. Bitcoin spot ETF has seen a net inflow of $58.5 million for five consecutive days, of which 12% of the funds were indirectly allocated to Ethereum through tools like Grayscale ETHE. The European pension fund ABP disclosed holdings of $270 million in ETH, further broadening the entry path for traditional capital.

Potential risk signals

- Upgrade effects to be verified: Historical data shows that the price volatility typically increases by an average of 58% within 30 days after a major upgrade; after the Istanbul upgrade in 2019, ETH saw a drawdown of 23%;

- Derivatives overheating: The long-short ratio for futures has risen to 1.9:1, with the concentration of CME Ethereum options positions reaching 91%, posing a risk of a long-short squeeze;

- Regulatory variables: The SEC has postponed the decision on the Ethereum spot ETF to Q3 2024, and developments in the Coinbase lawsuit may trigger short-term selling pressure.

Key observation indicators

- Price defense line: The daily line must hold the support at $2,850, and if the weekly line breaks through $3,150, it will open up upward space.

- Capital flow: Pay attention to whether the net outflow of ETH from exchanges continues (current weekly net outflow is 220,000 coins).

- Ecological verification: The L2 network TVL needs to break through $40 billion (currently $36.2 billion), and the weekly trading volume of DEX should maintain above $18 billion.

(Data support: CoinGlass futures liquidation data, Etherscan on-chain development indicators, European ABP fund position disclosure)

Operation tip: In the short term, pay attention to fluctuations in the range of $2,900-$3,100, and if it breaks through $3,150, increase the position accordingly. If the weekly line closes below $2,800, risk control needs to be activated. It is recommended to allocate 5%-10% of the position to hedge against regulatory risks #ETH