Woofun AI reports that ETH faces a pivotal technical juncture as the asset trades within a critical support band between $1,691 and $1,722. Recent price action completed a five-wave advance, yet the overlapping structure has complicated classification, leaving diagonal interpretations under active review. While the blue wave one-two scenario remains technically valid, the current decline from Monday's high mirrors a five-wave impulsive pattern, suggesting wave two may still be unfolding. Buyers are currently defending the $1,691 to $1,722 region, which coincides with the 50% to 78.6% Fibonacci retracement zone where deep corrections frequently occur.

The structural integrity of the bullish case hinges on the $1,691 level, which acts as the primary warning signal for market participants. A breach below this threshold would significantly erode confidence, while a drop to $1,668 would serve as the complete invalidation point for the current upward thesis. Conversely, if support holds against current pressure, upside projections remain intact with wave extensions targeting the $1,930 to $2,040 region. Intermediate resistance levels persist along this path, requiring sustained buying momentum to overcome.

Woofun AI data shows that market leverage dynamics have shifted dramatically over the past months, with early February witnessing major stress as long liquidations exceeded $1 billion during sharp declines. Heavy leverage at that time accelerated downside pressure across the broader market, creating a volatile environment that persisted until trading activity stabilized during February and March. During this stabilization period, liquidation volumes became more balanced across positions, allowing price action to consolidate within a broad range before new volatility emerged.

A distinct cluster of long liquidations reappeared in early June, accompanied by short liquidations during temporary rebounds, indicating heightened volatility on both sides of the order book. As of the time of writing, liquidation activity has moderated across the Ethereum market, though the asset continues to face downward pressure. ETH traded with $12.93 billion in volume, posting a daily decline of 5.79% and a weekly drop of 7.26%. This sequence of events marks a critical test of market resilience following the recent leverage flush.