Currently leaning towards short selling, I have summarized two options and the analysis logic.

Option 1: Resistance at high levels (Left trade - higher efficiency and less loss)
• Entry point: Wait until the price rises again to the range of $3,260 - $3,275 (Near the previous high and the upper band of the daily Bollinger Bands).
• Stop-loss level: $3,290.
• Reason: If it breaks through $3,290, it indicates that the upward space on the daily level has opened, and short selling should exit immediately and stop losses.
• First target: $3,180 (The middle line of the Bollinger Bands on the hourly).
• Second target: $3,120 (The lower band of the Bollinger Bands on the 4-hour chart).
Option 2: Confirm the breakout (Right trade - more stable)
• Entry point: Wait until the 15-minute candle breaks and closes below $3,210 (Any short-term support break).
• Stop-loss level: $3,240 (Wait until it does not rebound again).
• Target: $3,130 - $3,150.
Short selling restrictions (Attention needed)
1. Completely prohibit "holding the position": The overall trend is currently bullish, and short selling is only to benefit from the correction. If the price strongly breaks through $3,300, it indicates the market is entering a phase of accelerated rise, and short selling should not be taken to the death.
2. Take profits in stages: Since the trend is reversed, when the price drops to a certain support level (Like $3,180), reduce the size or adjust the stop-loss to the entry point to ensure capital safety.
3. Monitor trading volume: If the price trades around $3,260 and does not decline, and trading volume decreases, this often signals the market is preparing to rise again, and the short position should be withdrawn in this case.
Analysis of the logic for opening the trade:
First, analyze the depth of market movement
Ethereum is currently in a strong upward trend but faces short-term correction pressure:
1. On the daily level: The price is in a significant rebound phase, approaching the upper limit of the Bollinger Bands (around 3281). The KDJ indicator shows that the J value has exceeded 100 (101.95), indicating an overbought condition, meaning the trend is bullish, but the risk and reward at the current price are not ideal.
2. On the 4-hour level: A typical upward arrangement. The price moves along the upper Bollinger Band, and MACD shows a golden cross with increasing volume. The key point is the last peak at 3,263.78, and if it is not broken with volume, a short-term double top or oscillation at a high level may form.
3. On the hourly / 15-minute level: Oscillation has begun to converge, and the Bollinger Bands are flattening. This is often a sign that a trend reversal is approaching. On the hourly chart, the MACD shows a shrinking red bar, indicating weakening short-term upward momentum.
Strong resistance level: 3264-3300, previous peak pressure + valid level + the upper Bollinger Band of the daily.
First support: 3180-3200, the middle line of the Bollinger Bands on the hourly and 4-hour charts, with psychological support.
Strong support: 3120-3130, the lower Bollinger Band on the 4-hour chart, and the previous low on the 15-minute chart.
1. Do not chase the rise: The KDJ indicator is at a high level, and the current price of 3,223 is very close to the upper resistance level. Opening a position now means the risk-to-reward ratio is less than 1:1, which is inconsistent with the principle of high efficiency.
2. Monitor volume: If the price exceeds 3,264 with trading volume, consider entering on a retest rather than immediate breakout.
Logic for supporting short selling (Why consider selling now?)
1. Clear resistance level: 3,263.78 is a short-term clear peak. If the price attempts to break through again and fails, it will form a double top pattern.
2. Overbought condition: The J value of the daily KDJ indicator has exceeded 100, indicating that market sentiment is very enthusiastic, and a technical correction may occur to fix the large divergence.
3. Momentum decline: On the 15-minute and 1-hour charts, the red MACD bars are shrinking, indicating that the upward momentum is weakening.