The recent trends in the cryptocurrency market have led many players to feel a strong sense of 'contradiction.' Analyzing from the data perspective, the weakening market demand and lack of upward momentum are undeniable facts, yet the market has not plummeted as expected. Every time the price drops, bottom-fishing funds surge in like a tide, quickly pushing prices back up, even reaching new highs. What kind of logic lies behind this divergence?
The traditional concept of bull and bear cycles has faced severe challenges in this market. In the past, once the market entered a phase of diminishing momentum, insufficient demand and rising selling pressure would quickly emerge, prompting players to sell off, leading the market into a vicious cycle and starting a prolonged bear market. Based on such historical experience, people often equate 'diminishing momentum' directly with 'deep correction.'
However, this market cycle shows a completely different operating pattern. Insufficient momentum is merely a brief interruption of the rapid upward trend; to trigger a deep correction, it must rely on event-driven factors. Major events such as the collapse of the Japanese stock market in August 2024 and the restart of the tariff war in March 2025 are the key factors that break market equilibrium and trigger price adjustments. The weakening momentum reflected in market data only indicates insufficient buying power, and in the absence of negative events that stimulate risk-averse sentiment and increase selling pressure, the market can only oscillate within a range.
The unique market trend of 'institutional bulls, Bitcoin bulls' has given the market greater resilience. Even in the face of super negative events, the decline in Bitcoin prices is likely to be limited to around 30%, while the impact of less influential events on prices is even weaker. When diminishing momentum and event-driven factors work together, the market may decline, but when it reaches sensitive support levels like the mvrv extreme deviation or the STH average cost line, it will stabilize. This is mainly due to the involvement of a large amount of capital, which locks in market liquidity and is confident in the long-term prospects of the market, not easily changing investment strategies due to short-term price fluctuations.
The unpredictability of black swan events has always been a significant hidden danger in the market. Truly destructive major negative factors often erupt without any warning, instantly causing a massive impact on the market. Therefore, determining whether the current market is at a top range is extremely difficult; only when looking back in the future can we draw a definitive conclusion. Even if at a peak, the market's decline will be a gradual process.
Is the current market a relay platform for the next upward movement? The answer depends on whether two key conditions are met: market data shows a significant increase in demand and a substantial enhancement of upward momentum, as well as favorable macro-level events driven by external factors. Although there are many foreseeable macro-positive factors in the current market, prices have not risen significantly, mainly because market demand conditions have not yet met the standards. Therefore, the likelihood of the market being at a top range is high, but it lacks the ignition point of key events. If there are significant changes in market data, we will need to reassess whether the market trend has reversed.