Every time there is a war in the Middle East, the cryptocurrency market tends to shake, but often rebounds after the shake. For example, during the 2020 US-Iran conflict, Bitcoin rose by 50% in a month; during the 2022 Russia-Ukraine war, it also rebounded by 40% in a month. However, in recent instances, the reaction has been quicker, such as during the 2023 Israel-Palestine conflict, where it recovered lost ground in just a week, and the 2024 Iranian drone attack that recovered in as little as 24 hours. But this time is different; Israel directly bombed Iranian nuclear facilities, which could trigger a full-scale war, leading to a more intense market reaction.

This decline has several special points:

1. Escalation of war risks: Israel's airstrike on Iranian nuclear facilities could provoke direct retaliation from Iran, and even US intervention. This systemic risk caused funds to flee first.

2. Technical overselling: Bitcoin's RSI dropped to 35 (oversold area), and Ethereum fell below the key support of $2500, indicating a technical need for a rebound.

3. Severe leverage liquidation: $1.16 billion was liquidated in 24 hours, with 92% being long positions. After panic selling, short covering may drive a rebound.

4. Dominance of short positions in funding: The funding rate for Bitcoin perpetual contracts turned negative, indicating dominance of short positions, but some shorts began to take profits, which may build momentum for a rebound.

Key signals to watch:

1. Geopolitical dynamics: Will Iran retaliate directly? Will the US intervene? If Iran only issues verbal warnings, the market will calm down quickly.

2. Fund flows: If BlackRock's Bitcoin ETF sees over $100 million in daily inflow, it indicates institutions are bottom-fishing, leading to a quick rebound.

3. Technical aspects: Whether Bitcoin can hold at $100,000 and Ethereum at $2500. If they can hold, the probability of a rebound increases significantly.

Advice for everyone:

• Short-term players: If the conflict eases, consider trying light positions at Bitcoin $102,000 and Ethereum $2500 with proper stop-loss settings. If the situation worsens, it’s better to stay out of the market.

• Long-term holders: War will not change the long-term trend, especially after Bitcoin's halving (which has already occurred in April 2024), making it scarcer. Consider gradually increasing positions.

Final conclusion:

The rebound time after this decline is likely between 3 to 14 days, depending on how the conflict develops. However, in the long run, the trends for Bitcoin and Ethereum remain unchanged, with institutional funds still flowing in, and the scarcity post-halving also supporting prices. Therefore, short-term volatility is an opportunity, and there’s no need to panic for long-term holdings.