Affected by the bearish PPI, Bitcoin's price fell from 124,500 to over 7,000 points, with a minimum drop to $117,180. Currently, it is in an oversold rebound. Ethereum dropped over 200 points from 4788 to a minimum of $4451. Currently, ETH is oscillating around $4600. In the last 24 hours, a total of 224,738 people were liquidated globally, with a total liquidation amount of $1.031 billion.
Reasons for the plunge
1. PPI data exceeded expectations, leading to a reduced probability of rate cuts in September.
2. The number of unemployment claims in the US for the week was lower than expected, which is bearish.
3. US stocks opened lower, causing the crypto market to decline.
4. The US spot ETF saw a net outflow of $293 million, ending a previous streak of 6 days of net inflow.
5. After Bitcoin reached a historical high, profit-takers cashing out caused the sell-off.
BTC
BTC has been suppressed by the 4h Bollinger Bands for 7 consecutive times, and after a strong SOS breakout, it completed a relatively standard crab pattern (standard 1.618, actual 1.595) to achieve another ATH. Last night, combined with bearish PPI news, there was a wave of baiting before a sell-off, directly spiking to the important support position on the 4H. If it doesn't break, there will be a slight rebound; if it breaks, look directly at the key support at 112K.
Currently, Bitcoin is experiencing a rebound from an oversold position. The current price increase can only be seen as a rebound, not a new upward trend. Be cautious about taking profits; $120,000 is a very strong resistance level and may not hold easily. If things go well, it might touch $120,600 before facing resistance and dropping again. The upper pressure points are at $119,800 and $121,600, with the best bottom-fishing range being $116,188 to $115,188 (you can set limit orders in advance; it doesn't matter if it doesn't drop to that level).
ETH
ETH directly broke through the important support at 1h last night, leading the overall market to break the line and liquidate. After a spike, the two supports around 4450 became important support levels. Let's look at two scenarios for the future:
- Red scenario: After breaking through the 1h midline resistance, it will directly attack the ATH, which coincides with the target of the butterfly pattern.
- Blue scenario: After forming a descending continuation channel between 4450 and 4600, it will break down, continuing to test the key support around 4200.
Which scenario do you prefer? I lean towards scenario 1, considering to try to go long with a stop loss to make a push, but remember to protect well. If ETH breaks this blue line, it will then make a V-shaped recovery, looking successively at 4666/4688, 4712, and 4770.
Although the 8-hour MACD has a death cross, it is too far from the zero axis, so there are variables. Today's intra-day 4-hour MACD should signal a stop in decline, so it won't go to the 8-hour adjustment low around 4412.
Many people are still asking if there will be a major drop.
Uniform response: Add to positions, otherwise it's just wasting needles. After adding positions, there will be rebounds at 15, 30 minutes, and 1 hour levels, and when the 4-hour MACD signals a stop in decline, it will make a V-shaped recovery to reclaim all losses.
Altcoin
Last night, Bitcoin and Ethereum plummeted, and altcoins followed with adjustments. Mainstream altcoins that dropped more than 4-6% can add to their spot positions; such opportunities are rare because continuous increases at high levels are not daring to add. Today, we will repair indicators below the 1-hour level and reorganize troops for a charge.
In the altcoin market, as previously mentioned, ETH still dominates the market. Although BTC and BNB led the ATH, the altcoins that showed significant increases are almost all ETH-based, such as $gtc, $skl, $eigen, $arb, $zk, etc. Sectors like infrastructure, DeFi, and L2 are all performing strongly.
However, these projects are still weaker compared to the main coin ETH. For example, arb is still down 5x from its previous high. I still have concerns about the future performance of these altcoins; this gap may widen further as ETH pulls away.
According to my investment strategy, at most, I would allocate 10% of my position to altcoins at this level. This round, just focus on leading coins. If you're not satisfied with the expected returns from the leaders, consider chasing coin stocks. This kind of volatility can yield huge alpha returns; coin stocks might move similarly to mainstream coin contracts, but the risk of liquidation is avoided, making it much better than contracts.