Fundamentals:
The commission for March has already been fully distributed a few days ago. If you have questions, please ask under this article; I will respond.
Let’s first talk about natural gas since many people are asking. I will write a tutorial this month, but considering the possibility of violating regulations, it probably won't be posted in public forums. I drew a chart last week and shared it with some fans; I will now post it in the analysis.
Natural gas is a highly cyclical product, which not only experiences annual fluctuations due to typhoons but also strictly follows the laws of a 20-year long-wave cycle. If you miss this year's gains from May to October, there will be multiple opportunities for significant fluctuations over the next 5 years (but the entry points will be hard to judge), and then you will have to wait another 20 years until 2045 for similar opportunities.
The current price can actually allow for a light position layout, but the most perfect position is 3.2, without needing leverage, as the returns are already quite substantial; handle it gradually.
Here’s a side note: when trading Bitcoin, I often emphasize cyclicality. In reality, the cyclicality of cryptocurrencies has not been effectively validated. Firstly, Bitcoin was born too late, and the earlier chaotic growth period does not count. Since 2013, there have only been two rounds of bull/bear patterns in four years, and the second round (2018-2021) formed a double top, which is not perfect.
Secondly, the halving cycle of Bitcoin, with 95% of Bitcoin already mined, will have diminishing effects. Miners who once held pricing power are now transferring their voice to large capital like BlackRock. Under these circumstances, how can we regard Bitcoin as a very regular cyclical product?
What is a cyclical product? First, it must have very clear and stable supply and demand, and secondly, one side of its supply/demand needs to have clear cyclical patterns.
For example: Typhoon affects natural gas production; winter coal demand surges; pig cycles in agricultural products, etc.
Of course, I personally do not like trading agricultural product futures due to low volatility. If you want to play the pig cycle, you can buy Muyuan, and the same goes for other products. However, for energy and precious metal futures, everyone can really start researching them. From the demand side perspective, humanity currently must have natural gas and coal, but we don’t necessarily need Bitcoin, so how can this cyclicality be established? I have always been skeptical about this.
In terms of gold, as soon as the analysis was released, it started to pull back. Now I’m really hesitant to say anything. My suggestion is to stay in cash and observe. Let’s wait until summer, July/August. At that time, we’ll see if the decline that started in April is a medium-term drop or a spike that continues to break new highs. If it's the latter, we will directly enter futures with a 3x short position in summer. But if the price drops below 2700 from the current level to July/August, then we can purchase gold via various platforms. I think it's better to avoid leverage and use a more convenient method. If there is still one more monthly level upward move, then holding without leverage for three years would be financially rewarding, and there's no need to take risks.
USD/EUR has dropped to a low of 0.9, and it seems to be just a continuation of the downward trend. Sometimes one really has to admire large funds. Do you all remember that my father and I took a job last December? It was a MicroStrategy order from a European client wanting to complete 200 million euros worth of USDT. This USDT was quickly converted into Hong Kong dollars by me and then into euros by my father. At that time, USD/EUR was 0.96, so the exchange difference was already 7%, amounting to 14 million euros. Even deducting all losses in between, the profit for MicroStrategy was at least 10 million euros. This is just one of MicroStrategy's commissions; we do not know how many clients they commissioned or how much amount they needed to convert into USDT. So when I see comments on Zhihu saying what will MicroStrategy do with the Bitcoin they bought at high prices, I actually think they might not face a storm; they have been secretly selling Bitcoin (though it might have been Michael Saylor selling, which I am not sure about). If MicroStrategy is indeed buying Bitcoin with several hundred million dollars weekly and still cannot drive the price up, then Bitcoin would really be doomed. During the last bull market, MicroStrategy also bought Bitcoin at 69,000, and they didn't go bankrupt when it dropped to 15,500. I even want to theorize whether the Bitcoin bought by MicroStrategy at 69,000 is owned by Michael Saylor and other executives. If that's the case, then there is no need to worry; even if MicroStrategy were to face a crisis, Michael would use his own funds to 'save' it. However, by then, the crypto space might again be in turmoil.
In terms of US stocks, I honestly say that short-term they are already somewhat oversold. However, from a long-term perspective, the current momentum of the Nasdaq does not seem to stop at 13,000; the low point of this bear market might be around 11,000. If this is the case, in the next bull market, regardless of whether it forms a head and shoulders top or a triple push wave (the difference is whether it breaks through 21,000), it will trigger a yearly level adjustment (refer to 2000-2009). You can understand it as the East rises and the West falls. Besides the pandemic, the previous two systemic financial risks in the U.S. occurred in election years (2000 and 2008). The next election year is 2028, corresponding to a halving in the crypto space, which should theoretically lead to a significant rise. Currently, we should be cautious.
However, from a short-term perspective, this drop should be about done this week, and there will still be a wave of retaliatory rebound to take out aggressive shorts, similarly in the crypto space. If you want to short now, you must not lose perspective.
Someone asked me about Hong Kong A-shares, whether it's time to buy on the dip (because I previously mentioned that a drop to around 3150 would be reasonable, and today it has already reached that). I think we should at least wait for a stop in decline... Moreover, I maintain my view on the A-share market that this year should not be a bull market but rather a monkey market. Our fundamentals have not reversed, and a bull market scenario will only appear after next year. To be honest, I think my predictions for A-shares have been relatively accurate. Last September, I was consistently bullish on A-shares when they were just over 2700 points. I mentioned that I expected them to exceed 3000 points before the end of the year, and some people in the comments were quite rude to me. I’ve forgotten the specific articles, but you can look them up if you're interested. On the other hand, the U.S. stock market is bearish, and it will be difficult for A-shares to remain unscathed. We really need to be very cautious this year.
Back to the market:
The market is currently very critical. The weekly drop starting from 110,000, or the first phase of the bear market, is actually about to complete quickly, structurally only missing the final 4H level drop, which could happen this week or next week.
Of course, even though the timing is about right, the position may differ significantly. Refer to the last 4H level drop of the previous bear market, which dropped from 43,000 to 32,000, a drop of more than 10,000 points. If the next rebound reaches 82,000, dropping 20,000 points would mean hitting around 62,000. It's not impossible, as seen from August 4 when it went from 61,000 to 49,000 in just one day.
Do not underestimate the last 4H level drop under the weekly line. The purpose of the central point leaving the mark is to hunt stop losses and obtain liquidity. The central point leaving the mark at the weekly level aims to blow up all shorts and longs. Refer to the violent surge on January 20 to 110,000, where it gained more than 10,000 points in 6 hours.
Previously, it was said that the last daily level drop of Bitcoin would lead to three 4H level drops. The first drop confirmed it ended at 81,000. Whether the second drop ended at 74,500 is not important, as the task of the second drop was to break through 76,500, which has already been accomplished. Therefore, the second 4H level drop could end at any time.
The key is the third 4H level drop; this drop can definitely be gambled on, as the panic selling and the resulting downward space are significant. We still follow the old rule of gradually placing shorts at the 4H level EMA60/EMA125. Personally, since I hold high position shorts on Bitcoin, I won't trade Bitcoin, but I will synchronize operations on Ethereum and SOL.
Then there's the bottom-fishing. Some people ask if 74,500 could be the bottom? The uncertainty in this bear market is that it hit the EMA250 two times at the 4H level, so from a structural standpoint, it has already completed three 4H level drops. I think this way: I don't rule out this possibility, and I have also exited my shorts in Ethereum and SOL.
But we need to pay attention to two points:
1. The 74,500 level has not experienced a sharp drop; it has been a gradual decline, so the probability of the last 4H level drop not materializing is greater than it coming to fruition.
2. Even if 74,500 is the bottom of this weekly level drop starting from 110,000, it doesn't matter because we are entering shorts in batches at the 4H level EMA60/EMA125. As long as position control is reasonable, we will definitely be able to get out of our positions because the bear market is not over. Even if US stocks rebound, it's just a rebound from oversold conditions, not a reversal; the larger bear market structure has not completed. The same goes for Bitcoin; indicators show higher prices and lower indicators, which means there is definitely still a weekly level drop yet to happen.
In summary, we have drawn two conclusions:
1. If you want to bottom fish, it's just for a gamble on a weekly upward move, not a bull market trend.
2. Do not bottom fish at the current position; it is better to miss out than to hard resist panic selling. Many people's position management may not be good, and I worry they can't hold.
So where do we bottom fish? We do so in the range of 64,000-59,000, using a pyramid building method, gradually entering long positions, controlling the liquidation price below 50,000, aiming for around 82,000.
Now let's talk about altcoins. From an indicator standpoint, altcoins are almost at the bottom. The altcoin season index has been hovering below 20 for over a month, and it’s time for a rebound. However, like mainstream coins, we must wait until panic selling emerges, with a significant volume drop and trigger. Only then can we position for long. Otherwise, it’s better to miss out; don’t be greedy.
Many altcoins can be traded, pay attention to DOGE, LINK, JTO, SUI, AAVE, SHIB, XLM, TON, ONDO.
In terms of operations:
1. $BTC short positions are held, take profit at 62,000. For long positions, place buy orders in the range of 64,000-59,000, building positions in a pyramid structure, aiming for 82,000, controlling the liquidation price below 50,000.
2. $ETH /$SOL As long as Bitcoin returns to the 4H level EMA60, add 1% of the position to short. If it hits EMA125, add 2% of the position to short, and close all positions when Bitcoin hits 62,000. But be careful: if Bitcoin hits the 4H level EMA250, add 4% of the position and then sell to break even when it drops.
For the long side, do not handle SOL/ETH with buy orders. When Bitcoin drops below 62,000, take the initial position, and when it drops to 59,000, add to the position. The position must be small, especially for Ethereum; be cautious.
3. In terms of altcoins, operate on the several coins I mentioned above. When Bitcoin hits 62,000, choose 1-2 coins to double your position gradually. When Bitcoin hits 59,000, invest in the remaining coins doubling the position.
Safely, when Bitcoin hits 64,000, purchase the aforementioned altcoins, and sell them when Bitcoin reaches 82,000.
