【$ETH 24-Hour Review: After the Crash, Why Am I Starting to Be Cautiously Bullish?】
Looking at this ETH candlestick chart today, anyone trading contracts probably had sweaty palms.
Just after it barely stabilized around 2769, two consecutive big bearish candles directly smashed through the 2500 level, with the low briefly dropping to 2405. In this kind of extreme volatility, I don’t know how many people’s stop-losses were mercilessly swept away. But what was most surprising was that just when everyone thought it was about to open a bottomless pit, price suddenly shot up with a big bullish candle and quickly pulled back to 2497.
This is a classic case of “liquidity sweep to trap longs and shake out positions”: first, an ultra-fast selloff breaks the psychological defense line of the bulls, forcing out panic selling, and then chips are quickly reclaimed at the bottom.
After experiencing such a dramatic swing, my first reaction was **“it has stabilized, and I can be cautiously bullish”**. The logic is as follows:
The bearish momentum has already faded. The 2405 low not only broke through the prior support platform, but also created extreme panic. When the market is at its most desperate, that is often a sign of a stage bottom. The bulls have a strong desire to defend. Being able to pull back above 2490 in such a short time shows that there is strong capital supporting the market around 2400, and the bulls have not given up resistance. The risk-reward ratio is becoming reasonable. After such a plunge, the rebound resistance usually won’t be too great, and the probability of probing upward is much higher than the probability of continuing to dump without restraint.
In the next live trading pace, I will focus closely on these two key levels:
Short-term strong support: 2440 — 2450 range. This was the ignition point of the previous rebound. If price can stabilize here with reduced volume, it will be an excellent “trial entry” point for a long position. If this level is broken, it means the shakeout is not over; exit immediately with a stop-loss, no hesitation. Short-term target/resistance: 2540 — 2550 range. This is a small platform formed during the previous decline. When price rebounds to here, there is a high probability of the first wave of profit-taking. At that point, I will first close half the position, then move the stop on the remaining position up, and let the profit run on its own.
After trading for a long time, you’ll find that what really helps you survive bull and bear markets is not how magical your directional prediction is, but whether you have a set of execution rules that can protect you when facing extreme market conditions.
Keep position size within 5%, and always use a stop-loss. As long as you preserve your capital, you’ll never be afraid of running out of firewood.
Looking at this ETH candlestick chart today, anyone trading contracts probably had sweaty palms.
Just after it barely stabilized around 2769, two consecutive big bearish candles directly smashed through the 2500 level, with the low briefly dropping to 2405. In this kind of extreme volatility, I don’t know how many people’s stop-losses were mercilessly swept away. But what was most surprising was that just when everyone thought it was about to open a bottomless pit, price suddenly shot up with a big bullish candle and quickly pulled back to 2497.
This is a classic case of “liquidity sweep to trap longs and shake out positions”: first, an ultra-fast selloff breaks the psychological defense line of the bulls, forcing out panic selling, and then chips are quickly reclaimed at the bottom.
After experiencing such a dramatic swing, my first reaction was **“it has stabilized, and I can be cautiously bullish”**. The logic is as follows:
The bearish momentum has already faded. The 2405 low not only broke through the prior support platform, but also created extreme panic. When the market is at its most desperate, that is often a sign of a stage bottom. The bulls have a strong desire to defend. Being able to pull back above 2490 in such a short time shows that there is strong capital supporting the market around 2400, and the bulls have not given up resistance. The risk-reward ratio is becoming reasonable. After such a plunge, the rebound resistance usually won’t be too great, and the probability of probing upward is much higher than the probability of continuing to dump without restraint.
In the next live trading pace, I will focus closely on these two key levels:
Short-term strong support: 2440 — 2450 range. This was the ignition point of the previous rebound. If price can stabilize here with reduced volume, it will be an excellent “trial entry” point for a long position. If this level is broken, it means the shakeout is not over; exit immediately with a stop-loss, no hesitation. Short-term target/resistance: 2540 — 2550 range. This is a small platform formed during the previous decline. When price rebounds to here, there is a high probability of the first wave of profit-taking. At that point, I will first close half the position, then move the stop on the remaining position up, and let the profit run on its own.
After trading for a long time, you’ll find that what really helps you survive bull and bear markets is not how magical your directional prediction is, but whether you have a set of execution rules that can protect you when facing extreme market conditions.
Keep position size within 5%, and always use a stop-loss. As long as you preserve your capital, you’ll never be afraid of running out of firewood.