【$ETH Signal】1H Oversold Rebound Trading, Watch for Short Squeeze and Capital Support

$ETH The 1H timeframe has entered oversold territory, with prices oscillating narrowly between 1934-1942. The 4H timeframe shows a slight stabilization after a volume spike and long bearish candle. The key point is: prices are falling but open interest (OI) remains stable, and the funding rate is negative, which suggests that the shorts may be overly crowded, presenting a potential rebound opportunity from a short squeeze. Market depth data shows a large sell order at the first level (1941.61) with 130 ETH, but buy support below remains decent, indicating the main force may be testing support levels.

🎯Direction: Long (Long)

🎯Entry/Order: 1938.00 - 1942.00 (Reason: Potential double bottom neckline on the 1H level and the upper boundary of the current consolidation zone, playing for a rebound)

🛑Stop Loss: 1920.00 (Reason: Break below previous low 1934 and the integer level confirms a downtrend continuation)

🚀Target 1: 1975.00 (Reason: 4H EMA20 resistance and the previous Fibonacci 0.382 retracement level)

🚀Target 2: 2000.00 (Reason: Psychological integer level and strong resistance near the 4H opening price)

🛡Trade Management:

- Position suggestion: Light position (Reason: The 4H trend remains bearish, this is a contrarian rebound play with higher risk)

- Execution strategy: After reaching Target 1, reduce position by 50% and move stop loss to entry point (breakeven). For the remaining position, look toward Target 2. If price stalls in the 1950-1960 range, consider exiting early.

Depth logic: Currently, RSI(14) is at 40.35, approaching oversold levels. Market logic indicates “price decline, combine with volume to determine whether it’s a long liquidation or main force distribution,” while stable OI suggests it’s not purely long liquidation. Negative funding rates increase short holding costs, and if signs of rebound appear, it could trigger a short covering wave, leading to a short squeeze. ATR is as high as 40, indicating high volatility, with a risk-reward ratio >1.5, suitable for short-term sniper entries.

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