Ethereum Longs at Risk? Analyst Warns of Recurring Weekly Liquidation Pattern

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Well, look who decided to make a grand entrance: Ethereum (ETH), breaking through the $4,900 mark like a cowboy at a rodeo. But, as anyone who’s been in this game for more than five minutes knows, the high-flying joyride didn’t last forever. Fast forward to now, and ETH’s hanging out at $4,520 – not quite the peak, but hey, it’s still up 7.6% over the past week. I guess we’ll take that, right?

What goes up must come down… right? Ethereum’s long-term trend still has that upward swagger, but the short-term? Well, that’s another story – it’s a bit like trying to predict the weather in a storm. That’s where the analysts come in. They’re squinting through the fog of volatility, trying to figure out what’s really happening under the hood.

Enter XWIN Research Japan, the heroes of the hour. These brave souls, contributing to CryptoQuant’s QuickTake platform, claim they’ve spotted a curious little pattern: recurring liquidation cycles that show up every week like clockwork. Specifically, around Monday. Oh, Mondays… always trying to ruin everyone’s weekend mood.

Ethereum’s “Monday Trap” and the Risks of Excessive Leverage

According to the folks over at XWIN Research Japan, there’s a pattern emerging in Ethereum’s leveraged markets. It’s a little thing called “liquidation” – fancy talk for when traders who borrowed a bunch of money to bet on rising prices get caught in the unfortunate trap of sudden reversals. When that happens, those positions get liquidated, and the downward price spiral just picks up steam.

Take a look at April and June 2025, when over 300,000 ETH was liquidated in a single day! A sharp downturn caused a chain reaction that sent prices flying south. But here’s the kicker: Monday’s consistently show the highest liquidation volumes, followed by Sundays and Fridays. Guess what day traders seem to love most for getting wrecked? Yep, it’s Monday. But hey, it’s not like anyone ever listens to the “don’t go into debt for crypto” advice. 🍻

Apparently, Saturdays are the calm before the storm, with low liquidation activity – probably because the market is too busy recovering from Friday night. But come Monday? The storm rolls in with all the institutional and retail traders reentering the market. You know, after a few too many cups of coffee.

So, if you’ve got some leveraged positions still riding high from the weekend, maybe reconsider holding onto that “Monday optimism.” The analyst is quick to point out that short-term leverage makes losses a lot harder to avoid. And trust me, no one likes getting wiped out on a Monday.

For those who aren’t just riding the short-term wave, this might just be an opportunity to sit back and watch the fireworks. For long-term investors, it’s all about understanding that leverage can be more of a danger than a blessing in volatile times. Sounds fun, right?

Technical Levels and Broader Market Outlook

Now, let’s talk charts. Ethereum’s price correction is like the calm after the storm – the kind of calm that makes you wonder if the storm is coming back for round two. Crypto Patel, a market analyst who doesn’t mind sharing his thoughts on X, recently pointed out that ETH’s retraced from $4,957 to $4,400. A strong support zone? Around $3,900 to $4,000. But if that breaks, well… we could be looking at $3,500 or even $3,200. Yikes. 😬

$ETH Price Analysis

#Ethereum hit ATH of $4957 2 days ago, now retracing to $4400.
Strong support at $3900-$4000. Holding this zone opens upside to $6000-$8000.
Breakdown of $3900 could lead to $3500 and $3200 levels.

– Crypto Patel (@CryptoPatel) August 26, 2025

Now, let’s talk about the big picture. Ethereum’s volatility is often tied to the flow of coins into and out of exchanges. When there’s a mass exodus of ETH, that usually signals long-term confidence. Conversely, when coins are flowing in, people are typically unloading. It’s like watching a crowded train station: when everyone’s leaving, things might be on the up. When everyone’s getting on? Well, maybe you should wait for the next train. 🚂

Speaking of long-term confidence, institutional demand for Ethereum is on the rise. Oh yes, they’re lining up, driven by the latest talk of staking and ETFs. Looks like Ethereum’s got more than just retail traders in its corner.

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2025-08-27 10:08