Is the recent pullback of Ethereum hiding secrets? Three major signals reveal that whales are setting a trap, is a $4,000 breakout imminent or a short positions trap? | ETH Price Prediction

Recently, Ethereum ( ETH ) price has come under pressure, plunging more than 8.6% at one point in the last 7 days, followed by a rebound, currently reported at $3,691.82, still a certain distance from the historical high. However, on-chain data and market indicators reveal a different picture: whale holdings are increasing against the trend, retail investors are following suit to increase positions, and the long-short account ratio is significantly bullish. Combined with the daily chart's rising triangle pattern not being broken, these three strong signals strongly suggest that the recent decline may be a carefully planned short trap. If the key support of $3,356 holds and the daily chart closes above $3,785, ETH may restart its offensive to challenge the $4,000 mark.

Signal 1: Whale and retail investor Holdings increase synchronously, medium holders are in a dilemma.

• On-chain Data Overview: In the past 30 days, the holdings of Ethereum whale addresses have increased by 1.82% against the trend, while retail investors (small holders) have also increased their holdings by 1.87%. Whale movements usually have a decisive impact on the market due to their large capital.
• Market Behavior Interpretation: Retail investors are showing signs of following whales in increasing their positions, which may lead to medium-sized investors becoming passive. Medium-sized wallets have shown a reduction in holdings during the same period, which may indicate that holdings are shifting towards two poles (whales/retail investors)—these two groups have markedly different motivations yet are rarely synchronized in their bullish outlook.
• Bull and Bear Address Indicator Evidence: The IntoTheBlock bull and bear address chart (based on actual buying and selling behavior rather than sentiment) shows that in the past 7 days, the number of "bull" addresses with buying volume exceeding 1% of the daily trading volume leads the number of "bear" addresses with selling volume exceeding 1% by 7 addresses. Although the difference is slight, it is sufficient to indicate that the market tends to accumulate rather than distribute.

Signal 2: The long-short account ratio remains strong, and traders' bullish expectations have not changed.

• Key Indicator Analysis: Although the ETH price is fluctuating sideways and frequently falling, trader sentiment has not turned bearish. The Binance (Binance) long-short account ratio currently stands at 1.91, meaning the number of user accounts holding long positions is nearly twice that of short accounts.
• Core Difference of Indicators: It should be noted that this ratio measures the number of accounts with long/short positions (not the value of position contracts). This data reflects that more traders expect the price to rise within the past 24 hours, even though the price fluctuates near key resistance levels.
• Historical Pattern Insights: Similar long and short account ratio levels have often appeared on the eve of significant directional breakthroughs in history.

Signal 3: The ascending triangle on the daily chart has not been broken, $3,356 is the critical line for bulls and bears.

• Key Technical Pattern: The Ethereum daily chart is forming a clear ascending triangle pattern. After soaring from a low of $2,120 to $3,939, ETH has entered a narrow consolidation. The 0.236 Fibonacci extension level (around $3,785) attempted to provide support but was quickly broken.
• Short Position Trap Example: Price broke below $3,785 accompanied by a long bearish candle, coinciding with heightened market bearish sentiment. Subsequently, the price tested the key support at the lower edge of the triangle at $3,356, triggering more selling (traders anticipated this level would break). However, after a brief dip to $3,356 yesterday, the price quickly rebounded, leading to the liquidation of "smart traders" who opened short positions at that level—this is a typical bear market trap case, indicating similar short positions may be widely present.
• Future Path Simulation:
  • Bullish Scenario: If the ETH daily chart closes above $3,785, it is expected to restart the rise, targeting the previous high of $3,939, and further challenging the target of $4,051 (confirming effective breakout).
  • Bearish scenario: If the key support level of $3,356 is ultimately broken, the current bullish assumption will be invalidated, and the risk of a deep pullback will increase.

Conclusion: Although Ethereum's short-term price fluctuations appear weak, the synchronized accumulation by Whales and retail investors, the traders' firm bullish bets (long-short account ratio), and the resilience of the key ascending triangle pattern on the daily chart all point to the current decline possibly being a trap for short positions. Investors need to closely monitor the outcome of the defense at the $3,356 support level and the $3,785 resistance level; this battle will determine whether ETH can gather enough momentum to challenge the psychological barrier of $4,000, or declare the end of its short-term rising trend. The divergence signals from on-chain data and the derivatives market add a crucial dimension to the game regarding ETH's price movement.