The Force Behind ETH's Volatile Swings: Macro Trends and On-Chain Whales Catalyzing a Rebound

Event Recap 🔍

Recently, a combination of macro and on-chain factors has led to significant volatility in ETH prices. Starting at 10:40 PM, ETH price rapidly surged from $1,965 to $2,040, a 3.74% increase within 46 minutes. In subsequent trading, from 10:40 PM to 11:35 PM, the price again soared from $1,980 to $2,050, approximately a 3.51% rise. Although some profit-taking occurred after this sharp movement, the current quote remains around $2,032.24. This series of fluctuations reflects both the positive macroeconomic data boosting risk appetite and active adjustments by whale and institutional funds on-chain.

Timeline ⏰

11:11 PM: The market focused on macro data, with CPI figures from Canada and the US showing moderate inflation. Overall CPI was 2.4%, core CPI year-over-year was 2.5%, boosting expectations for rate cuts.

11:15 PM: Data showed US January core CPI hit a nearly five-year low, reducing concerns about continued rate hikes and increasing the attractiveness of risk assets.

11:20 PM: Multiple institutions interpreted the data, believing that easing inflation creates policy space for future rate cuts, and market sentiment gradually warmed.

11:32 PM: Significant on-chain fund movements appeared, with a whale depositing about 14,745 ETH (worth approximately $28.75 million) into OKX exchange within 24 hours, indicating large holder position adjustments and institutional fund flows fueling a market rebound.

10:40 PM: ETH price surged from $1,965 to $2,040 amid rising risk appetite.

11:35 PM: Driven by persistent buying, the price further climbed from $1,980 to $2,050, successfully breaking key resistance levels, with institutional and retail investor resonance confirming a shift in market sentiment.

11:55 PM: After a brief correction, ETH price retreated to around $2,032.24, with market volatility stabilizing but overall bullish resilience remaining strong.

Analysis of Causes 🔑

Macro Economic Improvement US January CPI data came in below expectations, with overall CPI at 2.4% and core CPI at 2.5%, indicating inflation pressures are easing. This alleviation of inflation concerns boosts expectations for future rate cuts by the Fed, enhancing risk asset attractiveness.

Active Whale and Institutional Funds Recently, large ETH transfers have occurred, notably a whale depositing nearly 14,700 ETH into exchanges. Such movements often signal large-scale position adjustments and technical rebounds. The combined effect of institutions and retail investors has led to a rapid upward surge in ETH within a short period.

Shift in Market Risk Appetite When macro data and on-chain fund movements send positive signals simultaneously, investor confidence improves. Some investors use leverage long positions, which can intensify short-term volatility but also support subsequent price movements.

Technical Analysis 📈

This technical analysis is based on 45-minute K-line data of Binance USDT perpetual contracts:

K-line Trend: The current price is running along the upper Bollinger Band, indicating strong upward momentum but also approaching overbought territory. A doji pattern appears on the chart, suggesting market hesitation and potential short-term reversal risk.

Indicator Signals:

KDJ has formed a golden cross, indicating short-term bullishness, but convergence warns of possible future uncertainty.

RSI is in overbought territory; even after breaking above the upward trendline, caution is advised for short-term corrections.

Trading volume surged by 109.51%, with a significant increase in volume relative to price, indicating high market activity at elevated levels and possible panic profit-taking signals.

Moving Averages:

Price is currently above MA5, MA10, MA20, MA50, and EMA5/10/20/50/120, showing a bullish trend.

EMA24 is above EMA52 with an upward slope (slope ≈ 0.83%), indicating a stable medium- to long-term trend, though current short-term volatility warrants caution for top reversal risks.

Large Orders and Big Transactions: Data shows nearly $9 million in large orders within the past hour, with 88% short positions and a net inflow of about $30 million, further confirming intense market capital flows and short-term turbulence.

Market Outlook 🔮

The future market trend will remain highly uncertain. If US economic data continues to improve, inflation stays low, and rate cut expectations gradually emerge, ETH may continue to trend upward amid rising risk appetite. However, technical indicators like RSI overbought levels and doji patterns suggest the possibility of profit-taking or corrections in the short term. Investors are advised to:

Risk Management: Be cautious after breaking key resistance levels, take partial profits at highs, and reduce concentration risk.

Monitor Macro Data: Ongoing US and global macroeconomic data will continue to influence risk appetite in crypto markets; strategies should be adjusted accordingly.

Phased Positioning: For long-term bullish investors on ETH, consider dollar-cost averaging to optimize entry points during pullbacks.

Overall, the current sharp volatility in ETH reflects high capital concentration and rapid shifts in market sentiment. Supported by macro improvements and whale activity, ETH’s long-term outlook remains positive, but short-term risks persist. Investors should remain rational, prioritize risk management, and carefully allocate funds.