Ethereum Intraday Key Breakthrough: Upper Shadow Reveals Main Force's Intent, Fund Battle Between $3200 Gains and Losses

Current Situation: A Single Red K-Line Upper Shadow Explains Everything

Today, Ethereum is at a critical crossroads near $3164. The volume surge red K-line that broke through to $3227 in the early hours seems fierce but actually hides a secret—the extremely long upper shadow clearly reflects significant selling pressure in the $3200-$3230 region. This is not an ordinary failed test; it is a signal from the main funds indicating a shorting bias.

The latest price is $3.12K, up +0.41%, and technically, a 4-hour descending flag pattern is forming. The breakout direction of this pattern will determine the market trend in the next 6-12 hours.

Divergence Signals in Capital Flows

On-chain data is more honest than candlestick charts. Over the past 24 hours, net inflow of ETH on exchanges has increased by about 42%, which usually indicates brewing selling pressure.

More noteworthy is the movement of large funds: between 9-10 am Beijing time, three massive transfers involved over 42,000 ETH flowing into centralized exchanges, totaling $130 million. In stark contrast, when the price touched below $3120, Smart Money addresses continued to accumulate in batches. Although individual transactions are small, multiple entries show savvy funds deploying on dips.

The perpetual contract market shows signs of cooling: funding rates have fallen from high levels to near neutral, indicating a clear decline in bullish enthusiasm. Liquidation distributions show dense stop-loss orders above $3220 and strong long liquidations below $3080, suggesting the price may be attracted to clear out one side’s stop-loss positions.

Technical Resistance and Support System

Two defensive lines facing upward:

The first resistance is at $3160—this is both the upper boundary of the flag pattern and the starting point of the early morning correction. Successfully holding above this level is a prerequisite for bulls to regain control.

A more formidable resistance zone is between $3220-$3250. With previous highs and options pain points concentrated here, a breakout in one go is highly challenging.

Support system below:

Weak support at $3100 psychological level, also the 0.236 Fibonacci retracement of this wave’s rally. Falling below this would significantly weaken market sentiment.

The real main line of defense is in the $3050-$3030 area—where the 4-hour MA60 and the 0.382 Fibonacci retracement overlap. This is the last barrier for bulls. Once broken with volume, the short-term trend will reverse downward.

The Two Most Likely Scenarios

Scenario A (55% probability): Testing support downward

Price fails to hold above $3160 and breaks below $3100, further testing the core support zone at $3050-$3030. If buying interest resumes afterward, there could be a rebound to revisit $3150-$3180.

Trading plan—Aggressive: Scale in with small longs between $3080-$3050, stop-loss below $3020, target $3150-$3180.

Trading plan—Conservative: Wait for a clear bullish engulfing or bullish divergence on the 15-minute chart, confirm the bottom pattern before entering.

Scenario B (45% probability): Strong consolidation followed by another attack

Price consolidates strongly above $3100, and before the European or US market open, with capital inflows, it breaks through $3160 with volume and closes firmly above.

Entry signal: 1-hour candle closes clearly above $3160 with increased volume.

Operation method: After confirming the breakout, add small longs, stop-loss at $3130, with short-term targets at $3220-$3250.

Risk Reminder

The above analysis is based on technical and capital data from the morning of January 5. Market risks always exist. All strategies must include strict stop-loss settings, and traders should assess their risk tolerance rationally before operating. This article is for technical analysis reference only and does not constitute investment advice. Investors should make independent judgments and bear their own risks.