Ethereum collapses below $1,900... Hit hard by $10.1 billion 'long position liquidation'

▲ Ethereum (ETH), bear market/AI-generated image ©

The decisive reason Ethereum (ETH) fell below $1,900 was a massive liquidation of excessively accumulated leveraged long positions rather than spot selling.

According to CoinMarketCap, a cryptocurrency market data aggregator, on July 29 (local time), Ethereum recorded a 1.91% decrease over 24 hours, trading at $1,882.26, showing a weaker performance than the overall cryptocurrency market. During the same period, the total cryptocurrency market capitalization also decreased by 1%, indicating that the overall market weakness amplified Ethereum's downward pressure.

The direct cause of the decline was a large-scale deleveraging in the derivatives market. On July 29, Ethereum's leveraged long position liquidations exceeded $10.15 billion, and a chain reaction of forced selling amplified the price drop. This correction is characterized more by the sudden clearing of excessive bullish bets than by a massive exodus of spot investors.

Technically, Ethereum failed to settle above its daily pivot point of $1,900.93. It is also significantly below the 200-day Exponential Moving Average (EMA) of $2,215.72, which indicates a long-term trend, suggesting persistent medium-to-long-term selling pressure. In the short term, a recovery above $1,900 is necessary to confirm a potential rebound; otherwise, the bearish trend is likely to continue.

The key support zone is between $1,830 and $1,846, where recent lows overlap with a long-term value area. If this range holds, it could consolidate before retesting $1,900. However, a decisive close below $1,830 risks further liquidations and a drop to the psychological support level of $1,800.

Currently, Ethereum is in an unstable phase where the influx of buying interest after the leverage liquidation shock needs to be confirmed. If liquidation volumes decrease and funding rates normalize, a reduction in selling pressure can be expected. However, if $1,830 fails to hold, the short-term trend is more likely to lean towards further decline than consolidation.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*