Journalist
Posted:
Key Takeaways
Ethereum is holding $4.3k. But is this resilience or the start of a volatility storm?
Ethereum [ETH] is stuck in a classic volatility trap.
For the past two weeks, it’s been chopping around $4.27k–$4.3k, letting both bulls and bears stack liquidity and hunt for the next swing. With the long/short ratio dead even at 49-50%, the tape feels razor-thin.
In short, any big squeeze or liquidity sweep could trigger a quick move. Technically, Ethereum is flashing mid-June energy. Back then, ETH held under $2.5k for two weeks before ripping 40% in 14 days.
Source: TradingView (ETH/USDT)
But there’s a key divergence this cycle.
Unlike June, when the RSI was creeping up under the chop, hinting at quiet accumulation, this time it’s dead flat. That tells us the “buy the dip” crew isn’t stacking, leaving $4.3k on shaky ground.
In this context, rising Open Interest (OI) could be a red flag, hinting at bears fishing for stops. Against this backdrop, could Ethereum’s tense sideways chop be shaping up as a textbook bull trap?
Ethereum eyes lower liquidity sweep before bullish reversal
On Binance, ETH longs are getting crowded, with a heavy 70% skew.
On top of that, dip-buying is MIA, with Ethereum spot ETFs bleeding $96.7 million in a day, marking six straight days of outflows. That’s a big contrast to mid-June, when $500 million flowed in, fueling that sharp rebound.
Down in the tape, liquidity’s stacking below $4k, with $3.97k holding $266 million in long leverage. Simply put, a sweep through this zone could trigger a nasty stop run, setting the stage for a more explosive reversal.
Source: Coinglass
Simply put, this setup is feeding the bull trap thesis for Ethereum.
Tape is flashing bearish divergence, spot demand is thin, and longs are stacked heavy, creating a textbook setup for a volatility trap that could flush weak hands before a proper bounce takes hold.
That leaves $4.3k support shaky, making a mid-June-style rip pretty unlikely if this pattern holds. In other words, ETH bulls might need a cleaner reset before they can confidently re-enter.
