Yesterday, I entered around 80,000, and it has now risen by 4,000 points. Looking at BTC purely from a candlestick perspective, while it has broken through the short-term downtrend, a pattern of higher lows and higher highs has yet to appear. Is this truly another long-term low point?
Returning to the essence of BTC's holdings, the open contracts for BTC at the same price level have decreased significantly, indicating that the market has substantially removed leverage.
This method may not show significant differences, but we can compare it with ETH to understand how cleanly leverage has been removed.
Returning to February 3rd, when ETH spiked to 2,125, altcoins experienced the largest scale of contract liquidations in history. Comparing the red horizontal lines and small red circles of ETH, it can be seen that although the number of contracts removed has significantly decreased, it is still much higher than the contract volume at the same price level previously.
Next, let's take a look at the blue horizontal line representing the current position of ETH; the increase in contract numbers is on a completely different level.
Therefore, it is clear that Bitcoin's slimming down has been more successful, thus providing greater upward momentum!
Finally, let's look at the USDT.D ratio that I have been tracking. Although it hasn't risen to the ideal 6-7% range, it only reached a peak of 5.57% before encountering resistance and declining. This downside may indicate potential future sustainability issues. If the ratio were above 6-7%, a return to the trend line would provide greater upward space.
The current peak is at 5.57%. If it drops 20% back to the trend line of 4.45%, historically, a 20% drop in the ratio indicates a 20-25% rebound for Bitcoin. Calculating from yesterday's low of 78,000, a 20% rebound would bring the price back to 93,600.
If the ratio falls further to the previous low of 3.7%, about a 30% drop, this would allow BTC to rebound by 60-70%, reaching approximately 125,000.
In summary, cryptocurrencies are dominated by Bitcoin. The risk of Bitcoin experiencing significant contract leverage has diminished, and any decline will be limited, making any drop a good opportunity to re-enter and increase positions. The upward momentum is expected to first target 93,600 to 125,000.
#Market analysis for reference only #Does not constitute investment advice
