On Monday, BTC hit a new high again, but the gap near 114,200 has not been filled; the weak gap between 112,000-114,000 is likely to be filled, with a historical gap-filling probability of 100%, which can be filled through a drop or by hitting a new high again.
How do we view today's slight correction?
Yesterday BTC once again hit a new high of $123,218, attracting off-market funds, triggering short liquidations and an increase in funding rates and the basis spread, market sentiment slightly showing FOMO, and the main force pressed prices down, causing a correction, but the impact on spot and medium to long-term players is limited, and overall it is far from the peak, only putting pressure on those who chased high yesterday.
It is not difficult to see: in the 2025 bull market, institutions heavily invest in BTC and ETH, accounting for 67%, hedging risks through ETFs and derivatives, with off-exchange options trading volume surging 412%. Retail investors are keen on meme coins and altcoins, and the allocation to mainstream coins has dropped to 37%, with new coins like BONK, WIF, and POPCAT rising, while DOGE and SHIB's share is declining. Institutions view cryptocurrency as a macro asset, while retail investors pursue innovation. In the second half of the year, attention needs to be paid to the potential impact of the SEC's approval of the spot Dogecoin ETF; several institutions have submitted related applications.
Ranking of cryptocurrency segments is as follows:
First Tier: BTC, ETH, XRP, SUI, SOL, BNB, ADA, AAVE, HYPE;
Second Tier: BONK, PNUT, TAO, CRV, LTC, MKR, UNI, NEIRO, XLM;
Third Tier: BCH, SEI, DOGE, TRX, ENA, ENS, LINK, PEPE, WIF;
For those who don't understand and have significant capital, this can be a reference, but one needs to manage the entry points themselves.
Tomorrow's CPI data is the market focus
Market expectation 3%, Federal Reserve forecast 2.95%, both have a high probability of increase.
Although rising inflation may reduce expectations for the Fed to cut interest rates, the market is more focused on the new Fed policy, and Trump's low interest rate remarks also boosted sentiment; the impact of CPI exceeding expectations may be limited.
I estimate everyone is thinking: With the expectation of interest rate cuts in September, the US economy is stable, and unemployment is low, it is beneficial for the risk market, then another wave in the market will come. A recession may occur early next year, and then the market will correct, making it suitable for bottom-fishing. After the National Day next year, economic recovery, real liquidity flooding, and a major market begins. Sounds like a nice script, right? But interest rate cuts are beneficial but do not guarantee a surge; we will watch and see.
Today's Market Analysis:
BTC
BTC is experiencing a small continuous correction, and the current price has fallen below the first support level. I reminded last night not to be dragged down by BTC, and if it drops down, one needs to decisively stop-loss; unexpectedly, it still could not be avoided, and I have decisively stopped-loss.
Next, focus on BTC's small-level bottoming signals; if signs of bottoming appear, consider placing long positions. The key support level below is around 117,000, located in the moving average support area, which is also the planned long entry point.
ETH
ETH has not shown strong performance and has not moved out of an independent trend, continuing to correct downwards with the market. Currently, attention is on the support range of 2930-2900; if it does not break below and shows signs of bottoming, such as a pin bar, a long position will be considered.
Altcoins
The altcoin market is highly volatile, and liquidation density shows severe market divergence, indicating high volatility. HeKingfisher data shows an imbalance in long and short liquidations for mainstream cryptocurrencies, which may lead to sharp fluctuations at key price points.
Short Squeeze Watchlist (Upside Potential): The following altcoins have high short liquidation risk, and a price increase may trigger short covering, pushing prices higher:
AVAX: Price $21.39, daily rise 0.33%, weekly rise 18.78%. High short liquidation density, strong upward momentum.
LINK: Price $15.94, daily rise 1.39%, weekly rise 17.90%, short liquidation risk 91.3%, high upside potential.
LTC: Price $95.41, daily drop 0.66%, weekly rise 10.30%. Short liquidation risk 88.5%, potential rebound.
XLM: Price $0.4548, daily drop 2.23%, weekly rise 80.93%. Short liquidation risk 76.9%, correction may be short-term.
Long Squeeze Watchlist (Downside Risk): The following cryptocurrencies have high liquidation risk for long positions, and a price drop may trigger sell-offs, intensifying the downtrend:
RUNE: Price $1.55, daily rise 0.75%, weekly rise 16.79%. Long risk 89%, significant correction pressure.
AAVE: Price $319.18, daily rise 2.48%, weekly rise 10.87%. Long risk 79.4%, bullish momentum weakening.
The altcoin market is extremely volatile, with intense long and short battles, potentially triggering major market movements at any time; key price points need close monitoring!