Solid insights—smash that like button!!
First, a question: Since both were hit by the same black swan, why does SOL seem stronger than ETH?
If you've thought about it, congratulations—you've learned to think critically.
There are two answers: first, the black swan affects different coins differently; second, market structure.
For the first point, you can check out analyses by other experts.
Let me focus on the second point: Comparing charts 1 and 2, you can see that ETH's sharp rally had no hesitation. As a result, there hasn't been much position turnover in the current price range, leaving it as a vacuum zone with little liquidity. The price rises quickly when pushed up, but likewise, there's no strong support when it pulls back to this area. So ETH won't be easy to trade on a rebound for a while, because the structure isn't there. SOL's structure, however, is much clearer. So far, it's only swept the liquidity below the previous daily low. There are a lot of stop-loss orders from people who went long earlier, and when the price reaches this area, it's easy to trigger a cascade of liquidations. That's why the wick can go so deep and liquidate so many positions. After shorts take profit and close, there may be a rebound that looks “strong,” but that doesn't mean spot buyers are stepping in. Spot buying is the key factor in determining how far the price can go.
Now for my forecast of what happens next: For ETH, as shown by the black line, I hope it gets a daily-timeframe rebound. If it reaches the order block above, look for a break of structure on a lower timeframe, or for spot distribution, then look for a short entry. The downside target is near the EQ at 1982 in the previous range. For SOL, it could be 103 or 109—we'll only know when it gets there. The key is still to watch Bitcoin.
This is just a rough overall outlook, not a signal to trade as soon as those levels are reached.
First, a question: Since both were hit by the same black swan, why does SOL seem stronger than ETH?
If you've thought about it, congratulations—you've learned to think critically.
There are two answers: first, the black swan affects different coins differently; second, market structure.
For the first point, you can check out analyses by other experts.
Let me focus on the second point: Comparing charts 1 and 2, you can see that ETH's sharp rally had no hesitation. As a result, there hasn't been much position turnover in the current price range, leaving it as a vacuum zone with little liquidity. The price rises quickly when pushed up, but likewise, there's no strong support when it pulls back to this area. So ETH won't be easy to trade on a rebound for a while, because the structure isn't there. SOL's structure, however, is much clearer. So far, it's only swept the liquidity below the previous daily low. There are a lot of stop-loss orders from people who went long earlier, and when the price reaches this area, it's easy to trigger a cascade of liquidations. That's why the wick can go so deep and liquidate so many positions. After shorts take profit and close, there may be a rebound that looks “strong,” but that doesn't mean spot buyers are stepping in. Spot buying is the key factor in determining how far the price can go.
Now for my forecast of what happens next: For ETH, as shown by the black line, I hope it gets a daily-timeframe rebound. If it reaches the order block above, look for a break of structure on a lower timeframe, or for spot distribution, then look for a short entry. The downside target is near the EQ at 1982 in the previous range. For SOL, it could be 103 or 109—we'll only know when it gets there. The key is still to watch Bitcoin.
This is just a rough overall outlook, not a signal to trade as soon as those levels are reached.
