Gold plunges, ETH follows the decline: The behind-the-scenes logic of precise market manipulation | Position Reversal Master

Today, gold hit a record high then suddenly plunged nearly $100, while Ethereum simultaneously broke below the critical support level of 2900. This was not accidental but a strategic move by the market makers leveraging macro and technical factors to execute precise sell-offs. Below, from the perspective of the market makers, on the daily chart, capital flow, and structural patterns, we dissect the essence of this sharp decline, revealing the true face of the market.

1. Market Maker Perspective: Using Shakeout to Precisely Harvest Long Positions

The sharp drop in gold is a targeted harvest of overbought profit-taking positions by the market makers. The new high of $5598 triggered programmed selling, and exchanges raising margin requirements added further pressure, allowing market makers to execute a sell-off. As a risk asset, ETH became a secondary target for market makers to profit from the risk-off sentiment in gold. They first pushed gold higher to lure retail investors into bottom-fishing ETH, then synchronized the sell-off of gold and ETH, triggering over $52 million in ETH long positions to be liquidated, completing a precise shakeout and collecting low-position chips.

2. Daily Chart Level: Moving Average Resistance, Downtrend with No Reversal

ETH’s daily chart is firmly under bearish pressure, with prices continuously trading below MA7 (2945) and MA30 (2947). Short-term moving averages are all turning downward, and the 200-day moving average at $3500 remains high, with no rebound momentum in the medium and short term. Gold’s daily chart also shows a high-level bearish engulfing pattern, with an initial double-top formation. The bearish signals on the daily level directly transmit to the crypto market, causing ETH to follow the decline without resistance.

3. Capital Inflows and Outflows: Continuous Bloodletting, Safe-Haven Funds Fully Withdrawn

1. Although gold plunged sharply, safe-haven funds did not flow back into crypto but merely took profits within the market. Central banks worldwide continue to buy gold, so the safe-haven theme remains unchanged;
2. The ETH spot ETF saw a net outflow of $4.8176 million in a single day, and Grayscale’s ETHE experienced outflows exceeding $15 million. Institutional funds are continuously withdrawing, leaving only retail bottom-fickers in the market with no major players to absorb the sell-off;
3. Overall crypto market funds are shifting into gold tokens (XAUT). After whales dumped ETH, they increased their holdings of gold, leading to liquidity exhaustion in ETH and a persistent downtrend.

4. Structural Patterns: Breakout of Range, Support at the Box Completely Invalidated

ETH’s daily chart has been oscillating within a $2800-$3000 range for a long time. Today, it broke below the midline support of 2900, and after the breakdown, there was no rebound or retest, destroying the range structure entirely. The previous low-volume consolidation was not a bottoming process but a false pattern induced by market makers to lure longs. Once broken, only weak support at $2800 remains. If this support fails, the next target is the $2500-$2600 zone. Gold, on the other hand, formed a double top above $5500. After the pattern breakdown, the suppression of risk assets will continue.

Key Warning: This ETH plunge is not a short-term correction but a macro-driven strategic sell-off by market makers. $2800 is the last line of defense; breaking below it will trigger a new round of significant decline. Do not try to catch the falling knives!

Ethereum’s recent breakdown currently has no clear reason. The only related factor is that safe-haven assets are also experiencing extreme plunges!