Currently, in terms of the mid-term trends of BTC and ETH, the overall structure still maintains a "long positions dominant" situation. As for the drop in the early morning, I tend to view it as a "bear trap" pullback.

The reasons for this market structure can be roughly summarized into the following two points:
First, the short positions in the futures market likely completed the final round of adding positions yesterday. Most of these newly added short positions are concentrated in the previously high price area, which happens to be the clearing zone with the highest trading volume in the past three months.
From a funding perspective, the current market funding rate is still positive, which means the cost of going long is relatively high, indicating that the willingness to go long is still there. On the other hand, although it seems that the short positions are strong, it is more likely that these are some high-leverage, large-position hedging short orders. Otherwise, it would be hard to explain why the price has approached the liquidation line three times without triggering large-scale liquidations — this indicates that these shorts are not truly in a "pure short" direction.
Second, the selling pressure in the spot market has been absorbed by the buying pressure in the futures market. Meanwhile, the spot price of Bitcoin has started to show a premium compared to the futures, indicating a reinvestment of market funds into the spot market, which is a bullish signal.
However, due to the temporary balance between long positions and short positions, a range-bound fluctuation may continue in the short term. In this market condition, if there is another attempt to test the previous high position, there may be another opportunity for a short position.