In Ethereum, six major buying points have emerged since ’23, with the second largest liquidation of long positions occurring on January 12, coinciding with the approval of the spot Bitcoin ETFs and triggering a significant price correction.
Based on a recent examination, the liquidation of long positions has set a tail low at $2,450. A breach of this price followed by a swift recovery might suggest an imminent rebound. In contrast, an inability to recover may suggest a change in sentiment and a rise in downside volatility.
Critical Inflection Point for Ethereum
According to the latest analysis by CryptoQuant, large futures liquidations often result in longer-tailed candlesticks. This is indicative of substantial buying activity from market whales simultaneously with the liquidation of long positions.
The low point of these candlesticks becomes crucial, representing extreme market sentiment, as per the findings of analyst ‘MAC_D.’
The aftermath of such extreme situations becomes i
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