Recently, the market for Ethereum has indeed made many traders feel a bit exhausted. Just an hour ago, it was pushing towards $3100, only to turn around and drop back to around $2900. In this kind of severe fluctuation, those who chased the price are trapped, while those who bought the dip continue to lose.

As of now, the Ethereum price is at $3024.51, with a slight rise of 1.74% in the last 24 hours. However, looking at the 7-day period, it has already dropped by 3.28%. More importantly, the Fear and Greed Index has fallen to 25, which belongs to the extreme fear zone—under this condition, market participants are on the sidelines, making it particularly easy for traps of chasing the price and buying the dip to form.

In such a market, there are several traps that are easy to fall into. First is the old habit of chasing the price and killing the dip; seeing a rebound and jumping in, then cutting losses when it drops, resulting in always buying high and selling low. Secondly, ignoring the extreme states of market sentiment; extreme fear is often a precursor to a rebound, but it can also signal further declines. Simply judging by the sentiment index is not enough. Lastly, there is excessive leverage; using high multiples in times of insufficient liquidity can lead to stop losses being swept at any moment.

Current liquidity is indeed under pressure, and large capital inflows and outflows can have a significant impact. If you want to participate, you must have a clear understanding of your risk tolerance and not be swayed by the emotions of short-term fluctuations.