Bitcoin Volatility and Market Impact
In the past two days, Bitcoin's long and short volatility reached 5000 points, with altcoins declining much more than they increased. Some altcoins have given back nearly a week of gains within three days, intensifying short-term long and short battles.
Possibility of a Short Squeeze Reversal
After previously suggesting reducing Bitcoin and high-yield altcoin positions at high levels, the market has entered an adjustment phase. Many are asking whether Bitcoin will induce a short squeeze and then reverse. From the market perspective, bullish sentiment supports this pattern: a quick pullback from the low, forming a short-term high on the four-hour chart. However, I believe the short-term liquidity is insufficient to support a full reversal, even if a new high is reached. A reversal requires macro liquidity injection, such as the initial off-exchange buying brought by the approval of Bitcoin spot ETFs. Currently, the funds within the circle can only maintain the current price of Ethereum, making it difficult to push for a larger market movement.
Short-term Trends and Sentiment Game
A temporary high point does not represent an immediate sharp decline; sentiment brewing aims to absorb reverse positions and increase the main force's winning rate. Reducing positions at any point is reasonable.
Stablecoin Bill and Global Trends
The U.S. stablecoin bill is close to being passed and is expected to be implemented as scheduled. This move consolidates its dominant position in the crypto market and creates expectations for digesting U.S. debt, demonstrating strategic foresight. In contrast, China appears to lag slightly. South Korea plans to issue a won stablecoin to prevent capital outflow, and the renminbi may respond. There are rumors that the mainland will open the crypto market within two months, but the likelihood is low; however, it reflects the regulatory attitude towards openness, and policies are to be observed.
ETF Data and Market Signals
Yesterday, Bitcoin spot ETF had a net inflow of $667 million, and Ethereum spot ETF had a net inflow of $13.66 million, showing positive data. If this continues until the end of the month, the decline triggered by insufficient liquidity may end or reverse.
The approval of Solana spot ETF and staking ETF has been delayed due to prioritizing current market stability and a lack of urgency compared to last year.
Binance Alpha and Community Dynamics
The free airdrop in the Binance Alpha section is worth paying attention to, with low investment and high returns. In recent months, Mr. Liang's four accounts, with a single account investment of ≤100U, have accumulated 4800U in airdrops, far exceeding the earnings of most Web2 jobs.
BTC Analysis
Bitcoin large holders are concentrated at 93000-97000 points, serving as strong support before a potential new high. In the short term, it may test previous highs, but it is difficult to sustain a rally that changes the fundamentals. The reasonable logic suggests a slight dip to test the bottom, building momentum for a new high. Watch for support at 10100 points below; if it breaks, it may take a long time to confirm the bottom; the pressure above is the short-term high point. Be cautious about chasing highs before breaking new highs or breaking trend support.
ETH Analysis
Ethereum is linked to Bitcoin, with a trend of increasing positions during pullbacks. Current positions remain unchanged; if Bitcoin pulls back, the reduced positions can be shifted to Ethereum.
Altcoin Observation
RWA and DeFi concepts are expected to lead the rally, and the stablecoin bill is favorable for DeFi, causing Aave to rise. For altcoin positions, it is recommended to wait and see, except for necessary reductions, until the trend is clearer.
Fear and Greed Index: 71 for the day.
