Bitcoin's current trend is quite awkward; while U.S. stocks are plummeting, Bitcoin is shooting up like a firecracker. Who wrote this script?
Instead, one needs to be more cautious.
The possibility of a direct one-sided surge right now is low; after all, the overall macroeconomic situation does not support this trend. If U.S. stocks drop significantly and cryptocurrencies follow, that’s understandable, but if U.S. stocks drop while cryptocurrencies rise, it often indicates a high probability of trouble ahead.
First of all, since the Bitcoin spot ETF came into play, cryptocurrencies can be understood as tech stocks on Nasdaq, but they come with leverage built-in.
Secondly, if cryptocurrencies do not follow the drop and instead rise independently, it often means that the big players have intentions, and a bloody market is likely to follow, with a crazy harvest about to begin; it may just be turbulent waters, and a bloody market will unfold.
So we need to pay attention to the daily MA200 point; if it can break through, there is a great chance to test 91,600. If it cannot break through and holds steady before dropping back, it basically declares the end of this rebound. Last night's significant drop in U.S. stocks also led to a slight decline in BTC, but evidently, after U.S. stocks closed, BTC rebounded again within the day, showing strong momentum. The conclusion is that BTC is not worried about the current orderly decline in U.S. stocks but is concerned about a potential sharp drop triggering a circuit breaker.
This quick rebound in U.S. stocks after the close once again indicates that BTC's independent narrative and trend still exist and have momentum. Next, we’ll see if it can break through the MA200 position. Of course, BTC's current position is very ‘awkward,’ and it’s best to observe more and act less for now; short-term, it’s better to lean towards the right side.
Currently, global risk aversion is heating up significantly, gold is skyrocketing, having reached $3,400, which is over a 100% increase since the end of 2022.
This round of risk aversion in capital more stems from worries about U.S. dollar liquidity. In the three months since Trump took office, a series of “crazy moves” have confused U.S. credit, causing U.S. stocks, U.S. bonds, and the dollar index to all decline, leading to panic about a long-term economic recession, with capital fleeing the U.S. The only thing that seems “most reliable” is gold.
Recently Bitcoin has shown an independent trend; from this perspective, can Bitcoin's hedging property compare to gold?
I think it’s still early. If seeking safety, gold remains the best choice. I don’t know how long this independent trend of Bitcoin will last, nor how much it can rise, but if there are systemic negative factors, such as unfavorable GDP data by the end of the year, it’s very likely that BTC will again synchronize with the U.S.
Currently, the possibility of a reversal is not very high, and the conditions for a reversal are still not met, although I really hope BTC continues to rise since I have a position.
The fact that Bitcoin drops later than U.S. stocks indicates that the decline is due to liquidity issues rather than news factors. This time is no different; U.S. stocks are down due to tax-related economic slowdown and earnings pressure, which has nothing to do with BTC. On the contrary, BTC has anti-devaluation properties, so it rises. However, if U.S. stocks continue to fall and cause a liquidity crisis, both BTC and gold could drop.
Now it's really uncertain which direction to take after the change in trend, but after this bizarre surge, I'm actually being more cautious. Let's just see how it goes.
