Based on current market dynamics and policy environment, the support and resistance level forecasts for Bitcoin and Ethereum are as follows:
1. Bitcoin (BTC): A new cycle driven by institutionalization and policy dividends
1. Technical support and resistance levels
Short-term support levels: $117,000 (historical high point before the breakthrough on August 10, converted into strong support) and $113,000 (Fibonacci 61.8% retracement level coinciding with the 4-hour Vegas channel). If it loses $113,000, it may drop to $108,000 (50-day moving average support).
Short-term resistance levels: $122,000 (intraday high on August 11) and $125,000 (psychological barrier + historical volatility extension). After breaking above $125,000, the next target points towards $130,000 (2024 institutional accumulation cost zone).
2. Impact of policies and market structure
Regulatory framework implemented: The U.S. (CLARITY Act) clarifies CFTC's regulatory dominance over digital commodities. Bitcoin, as a 'mature' blockchain asset, is included in commodity regulation, reducing institutional compliance costs and is expected to attract more pension and sovereign fund allocations.
Monetary policy expectations: The Federal Reserve's August meeting shows increasing internal disagreement on rate cuts. If the September non-farm payroll data is weak, cuts may occur as early as Q4. The weak dollar cycle (with the dollar index falling from 110 to 96) combined with declining U.S. Treasury yields will strengthen Bitcoin's 'digital gold' attributes.
On-chain signals: Exchange Bitcoin reserves have fallen to 1.45 million (historical low), miners have increased their holdings for six consecutive months, indicating strong holding sentiment among long-term holders. However, be wary of liquidity fluctuations caused by large withdrawals from platforms like Bitfinex.
2. Ethereum (ETH): Dual driving forces of expansion narrative and DeFi ecosystem
1. Technical support and resistance levels
Short-term support levels: $4,100 (low point of the correction on August 11) and $3,900 (institutional accumulation cost zone in Q2 2025). If it falls below $3,900, it may trigger a chain liquidation in the derivatives market, reaching down to $3,600 (50-day moving average support).
Short-term resistance levels: $4,350 (intraday high on August 11) and $4,500 (golden ratio extension of the historical high in 2021). Breaking above $4,500 will open up space to target $5,000.
2. Technical upgrades and market sentiment
ZK technology breakthrough: Ethereum L1 plans to increase TPS to 10,000 transactions/second through zkEVM, with a test network already achieving a breakthrough of 2,000 TPS on August 6. If the mainnet upgrade goes smoothly, it will attract enterprise-level DeFi applications to migrate, driving on-chain transaction volume growth of over 30%.
Institutional capital inflow: Harvard’s endowment fund increased its Bitcoin ETF holdings by $116 million in Q2 while also increasing its Ethereum trust holdings by $230 million through Grayscale, indicating traditional asset management institutions' recognition of ETH's long-term value.
Risks in the derivatives market: CME Ethereum futures open interest reaches $4.5 billion (historical high), and long position concentration rises to 28%, requiring caution against short-term price manipulation caused by major capital shifts.
3. Macroeconomic risks and trading strategies
1. Key risk points
Geopolitical black swan: The security plan announced by the Trump administration on August 11 may trigger social unrest. If it escalates into nationwide protests, it could lead to a sell-off of risk assets.
Regulatory policy fluctuations: Although the SEC has suspended enforcement against DeFi protocols, it retains regulatory authority over 'hybrid assets.' If a particular DeFi project is deemed a security, it could trigger a chain reaction.
Liquidity exhaustion: Bitcoin mining difficulty rises to 113.76 T (historical high). If the price falls below $110,000, it could trigger large-scale sell-offs by mining companies, with daily selling pressure reaching 5,000 BTC.
2. Tactical recommendations
Bitcoin trading strategy:
Long position: Build a position near $115,000, stop loss at $112,000, target $122,000.
Short position: Light short at $123,000, stop loss at $125,000, target $118,000.
Ethereum trading strategy:
Long position: Build a position near $4,000, stop loss at $3,900, target $4,300.
Short position: Light short at $4,350, stop loss at $4,450, target $4,100.
3. Position management
Spot investors: It is recommended to maintain a 30% position, with remaining funds used for inter-period arbitrage (buying December futures and selling September futures).
Contract traders: Use the '1% risk rule,' with a single stop loss not exceeding 1% of total capital to avoid excessive leverage.
4. Long-term trend outlook
Bitcoin: If the Federal Reserve cumulatively cuts rates by 50 basis points in 2025, Bitcoin is expected to break $150,000 in Q4 and challenge the $200,000 mark in 2026.
Ethereum: With the full implementation of ZK-Rollup, DeFi TVL may exceed $1.5 trillion by the end of 2025, driving ETH prices towards $6,000.
It is recommended to closely monitor the Federal Reserve's Jackson Hole meeting on August 22. If Powell signals a dovish stance, it may ignite a new round of cryptocurrency rallies.
