Ethereum (ETH) recently soared to a record high, surpassing $4,900, before experiencing a price adjustment. Currently, the cryptocurrency is valued at approximately $4,520, representing an 8.9% decrease from its peak but still showing a 7.6% increase over the last week.
This price movement comes after several weeks of significant upward momentum, pushing ETH back to levels not seen since the 2021 bull market. While the overall long-term trend for Ethereum remains positive, market observers are closely analyzing short-term patterns to understand the present market fluctuations.
XWIN Research Japan, a contributor on CryptoQuant’s QuickTake platform, offers an interesting perspective, noting that recurring liquidation cycles are influencing ETH’s price dynamics, particularly at the start of each week.
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Ethereum’s “Monday Trap” Explained: Risks of High Leverage
The analysis suggests that leveraged Ethereum markets display a consistent pattern related to liquidation occurrences. Long positions using leverage – bets on rising prices – have frequently faced sudden downturns, leading to liquidations that intensify downward price movements.
Between April and June 2025, ETH experienced long liquidations exceeding 300,000 ETH in a single day as sharp declines triggered cascading sell-offs. XWIN Research Japan observed a notable weekly trend: liquidation volumes are consistently highest on Mondays, followed by Sundays and Fridays.
Conversely, Saturdays see the lowest liquidation volumes, likely due to lower market activity. This cycle, sometimes referred to as the “Monday Trap,” implies that traders holding leveraged positions over the weekend are particularly vulnerable when institutional and retail investment returns at the beginning of the week.
The analyst noted that taking “weekend optimism” into Monday’s higher-volume sessions poses a risk, adding that short-term leverage enhances losses predictably.
For long-term Ethereum holders, this cycle is less about price movement, and more about grasping the inherent risk associated with significant leverage in a very liquid marketplace.
Analyzing Key Technical Levels and Overall Market Perspective
From a technical analysis perspective, the ongoing Ethereum price adjustment is being closely watched. Crypto Patel, a prominent market analyst, recently shared on X (formerly Twitter) that ETH has decreased from $4,957 to $4,400, pointing out the $3,900–$4,000 range as an area of strong support.
According to Patel, maintaining this level could pave the way for potential increases towards $6,000–$8,000. However, should this support level fail, lower price targets of $3,500 or even $3,200 could be realized.
🚨 $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. pic.twitter.com/WJTdHEImqH— Crypto Patel (@CryptoPatel) August 26, 2025
The interaction between leveraged liquidations and critical technical support zones may determine Ethereum’s future direction in the months ahead. Past data reveals that large withdrawals from exchanges often precede significant rallies, while inflows typically indicate increased selling activity.
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Recent exchange netflow statistics for ETH have generally shown outflows, indicating that investors are moving their holdings into personal wallets, which is often considered a sign of long-term optimism as opposed to impending sales.
Concurrently, institutional interest in Ethereum remains robust, further fueled by ongoing discussions concerning staking integration into regulated financial vehicles like ETFs.
Featured image created with DALL-E, Chart from TradingView