Will the market crash?

The price rose over the weekend, and the most troublesome issue is the significant gap that will appear on the CME. Currently, both Bitcoin and Ethereum have such gaps.

BTC gap: around 118,400——119,000, a gap of 600 points.

ETH gap: around 4096——4229, a gap of over 133 points.

Will the gap be filled quickly?

CME gaps are different from URPD gaps and have a high probability of being filled, but not 100%.

The main reason is that CME gaps are caused by short-term surges in market sentiment, which are classified into 'normal' gaps and 'breakout' gaps.

Normal gaps have a fill probability as high as 90%, while breakout gaps have a lower probability of being filled in the short term. Especially, breakout gaps can be seen as a characteristic of accelerated market trends, and this situation is valid whether the market is rising or falling.

The appearance of a breakout gap indicates that at some stage, the price and market sentiment have excessively triggered the gap's formation. For example, a rising gap is caused by overly optimistic market sentiment over the weekend, while a falling gap is due to excessively pessimistic sentiment in the short term.

The price gap caused by this emotional squeeze indicates that the short-term direction becomes a trend, and to fill the gap, the sentiment needs to be completely digested.

How to distinguish between normal gaps and breakout gaps?

It's simple: look at the subsequent trend as a 'post-mortem' analysis. If the price continues to maintain a series of breakthroughs on the daily chart,

then it is clearly a signal of a price breakout, and this gap is considered a breakout gap, making it difficult to fill in the short term. For example, the gap near 92,000 on April 22 is challenging to fill in the short term.

Conversely, if the current trend shows significant signs of a daily pullback, then the probability of the short-term gap being filled is very high.

For instance, if the current Bitcoin price rises and then shows a clear pullback, and if the daily candle tomorrow shows an upward spike, with the subsequent trend gradually weakening, combined with macro factors guiding a pullback, then the daily-level pullback will quickly fill this 600-point gap.

Therefore, there is no need to worry about whether the gap will be filled in the short term; just confirm whether the subsequent trend continues to maintain a strong breakout or shows a clear pullback.