Last night, due to the escalation of the Middle East situation, mainly because Iran threatened to close the Strait of Hormuz, this important oil transportation channel, if closed, would have a huge impact on global oil prices, which would indirectly affect inflation and bring great uncertainty to the global landscape.
Of course, the Strait of Hormuz cannot be easily closed, or it is just a bargaining chip. Currently, it seems that Iran does not have the courage to do this. As for why this situation puts further pressure on the crypto market, it is mainly because the US stock market is closed on weekends, leading to a significant drop in the crypto market. BTC fell to a low of 98,200 USD, with a drop of over 6%, and ETH was worse, dropping more than 13%. The market liquidity is already low on weekends, and panic emotions can only be released in the crypto market, leading to an oversold situation for Bitcoin.
It feels like Iran, Israel, and the US are not fighting these days, but are crazily attacking retail investors' accounts!
Bitcoin is currently testing the important support level of 100,000, and it may not hold. If the fighting escalates later, the price will definitely drop below 100,000. Right now, the market is all about the news of the fighting. If you really want to buy at the bottom, you have to keep an eye on whether the US, Israel, and Iran are fighting more fiercely or calming down, as this will directly determine whether the short-term trend is up or down.
Based on the current situation, if there is no escalation of fighting, around 98,000 is roughly a temporary bottom; but if the fighting intensifies, the price is expected to drop to around 93,000.
This week, there are quite a few speeches from various Federal Reserve officials. On Monday, Bowman will speak, and on Tuesday and Wednesday, Powell has speeches. On Wednesday, FOMC permanent voting member Williams will also speak, and he is expected to discuss many issues regarding interest rate cuts, which will have a significant impact on the market. On Thursday, initial unemployment claims data will be released, and on Friday, the most important May PCE data will be announced. Furthermore, this week is still overshadowed by the conflict in the Middle East, so volatility will definitely be huge this week, and participants should be cautious in contract trading.
For BTC, a downturn has never been something to panic about; rather, it should be seen as something to celebrate. Every dip is for a better leap forward; pulling back is to strike better. A plane will take a lot of turns on the runway before takeoff, but this is just to ensure a better launch. BTC is like this.
So does this mean that the bull market pie breaking below 100,000 indicates the arrival of a bear market? I want to say that the overall state of the crypto circle is indeed a bear market right now, but for the bull market pie, the current market recognition is: even in a bear market, the pie is still worth at least 100,000 USD.
How much is that bull market pie worth? 150,000? 180,000 or 200,000? I can't guess, I just know that this price is definitely low, 100,000, and in the future it might continue to drop below 100,000, or it could be driven down to 90,000 by panic emotions. But if you have a slightly longer-term perspective, it is very likely that in a few months it will recover its losses. The traditional four-year cycle of bulls and bears might really be coming to an end due to the decrease in BTC mining rewards and the strengthening of market buying power. The future bull and bear cycles will change completely, and it may even be as Strategy's founder Saylor said: in the future, there will only be slow bulls, no bear markets.
Today, CZ spoke on X, hinting at the future market that cannot bloom in full; only truly valuable projects will break new highs, and only a few strong coins can do this. This can also be seen as a statement for Binance, which has been continuously launching new coins, now clearly stating that only a few strong coins will break new highs, so don't hold onto worthless projects.
As for the altcoin projects I currently maintain, they are pepe, aave, fet, and uni. These are all considered to have significant potential. One has strong consensus, and the rest are DeFi blue-chip projects, decentralized leaders, AI leaders. I suggest only playing with the leaders, and avoid touching the second and third-tier ones.
DeFi compliance in the US can also be considered a long-term positive.
In terms of funds, the recent ETF weekend did not open, but looking back at the working days of last week, it has been in an inflow state for nearly a month, and there has been no outflow in the last two weeks. This means that there is currently no panic fund escape. Tonight, the US stock market opening will likely be affected by the war, so the crypto market will likely be linked. However, the weekly trend line of the bull market pie is still intact, and this wave of military action means the US military spending will increase, putting more debt pressure, which may force the Federal Reserve to lower interest rates sooner.
Brothers, come gather in the chat room: