1. Interpretation of Core Market Data

1. ETF Capital Inflows: Institutions are continuously increasing positions, and Ethereum is becoming the new favorite.

- Bitcoin Spot ETF: Last week saw a net inflow of $2.39 billion, indicating that institutions are still increasing their allocation to Bitcoin, but the growth rate may slow down (previously single-week inflows exceeded $3 billion).

- Ethereum Spot ETF: Net inflow of $2.18 billion in a single week (a historical high), far exceeding market expectations, indicating that institutional funds are accelerating their inflow into ETH, which may drive it into an independent rising cycle.

- Key Conclusion:

- Bitcoin is still the first choice for institutions, but the demand for Ethereum allocation is rising rapidly.

- If ETF capital inflows continue, the ETH/BTC exchange rate may reach an inflection point (i.e., ETH outperforms BTC).

2. On-Chain Data: 98% of ETH holdings are profitable, the market has entered the FOMO phase.

- 98% of ETH holders are profitable, which means:

- Only 2% of positions are at a loss (mainly buyers at the peak of the 2021 bull market or high-leverage contract players).

- Market sentiment is entering an extremely optimistic phase, and short-term profit-taking may occur.

- Historical Patterns:

- When the profit ratio > 95%, the market usually enters a short-term overbought state, which may lead to a retracement or sideways consolidation.

- However, if capital continues to flow in (e.g., ETF buying), prices may continue to rise.

2. The Core Logic of the Current Market Cycle

1. Macro Policy Drivers: The expectation of interest rate cuts remains key.

- Federal Reserve Policy: Currently no interest rate cuts, but the market expects easing to potentially begin after September, which would be beneficial for risk assets (including cryptocurrencies).

- Trump Effect:

- Trump explicitly supports cryptocurrencies and may promote friendlier regulatory policies.

- If elected, it may accelerate the compliance process of the U.S. crypto industry (beneficial in the long term).

2. Institutionalization Trend: Listed Companies Are Buying Frenziedly

- MicroStrategy Model: Increasingly, more U.S. companies are purchasing BTC/ETH through bond issuance or stock increases to optimize their balance sheets.

- ETH Becomes the New Favorite: Compared to BTC, ETH has a smaller market cap and greater volatility, institutions may view it as a 'high Beta version of Bitcoin,' which may surge more during a bull market.

3. Market Cycle Position: Midpoint of a Bull Market, but be wary of short-term overheating.

- Altcoins have generally rebounded by 50%+, with some strong projects (such as SOL, TON, etc.) even doubling, posing short-term pullback risks.

- Critical Time Window:

- If the Federal Reserve cuts interest rates in September, the market may welcome the last wave of crazy increases (similar to Q4 2021).

- However, if policies do not meet expectations, there may be a substantial pullback.

3. Operational Strategy: How to Respond to the Current Market?

1. Position Management: How to take profits from profitable portions?

- Doubling Coins: It is recommended to sell at least the principal to let profits run.

- Deeply Stuck Coins: If the fundamentals are weak (e.g., old altcoins), consider liquidating to switch to stronger assets.

- Mainstream Coins (BTC/ETH): You can adopt a 'ladder-style profit-taking' strategy (e.g., sell part of your position every 10% increase).

2. Should we chase high prices?

- It is not recommended to blindly chase high prices for the following reasons:

- Most altcoins have rebounded significantly, and the probability of a short-term pullback is high.

- A better strategy is to wait for a breakout and confirm the pullback or look for buying opportunities after the market adjustment.

3. Cash Position Management

- It is recommended to keep 20-30% cash for:

- To respond to possible pullbacks (buying opportunities).

- Layout for the next round of strong sectors (such as AI, RWA, DeFi, etc.).

4. Future Key Observation Points

1. Short Term (1-2 weeks)

- Powell's Speech (Tonight at 20:30): If it releases dovish signals (indicating rate cuts), it may continue to drive upward; if hawkish, it may retrace.

- Can ETH stabilize above 4107: If it can break and stabilize, it may trigger a new round of increases.

2. Mid-Term (until Q1 2026)

- Federal Reserve's September Policy: If interest rate cuts are implemented, the market may enter the final crazy phase.

- Institutional Position Changes: If ETF capital inflow slows down, be wary of retracement risks.

3. Long Term (more than 1 year)

- The Institutionalization Process of Cryptocurrency: More listed companies and sovereign funds may enter the market.

- Regulatory Policies: After the U.S. elections, cryptocurrency regulations may become clearer, promoting industry standardization.

5. Summary: Current Best Strategy

✅ Profitable Positions: Partially take profits to lock in gains and avoid excessive greed.

✅ Cash Reserve: Keep 20-30%, waiting for better opportunities.

✅ Do not chase high prices: Wait for a pullback or confirmation after a breakout before adding positions.

✅ Pay Attention to Policies and Institutional Trends: The Federal Reserve's interest rate cuts, ETF capital flows, Trump’s policies, etc., will determine how far the bull market can go.

The current market is still in a bull market, but short-term overheating risks should be monitored. Stay rational, manage positions well, and seize the next opportunity! 🚀

BTC

Yesterday's triangle upper edge induced buying, seizing the small high point of 119530, those who didn't enter based on daily reports should have at least secured 3000 points in profit! The current triangle consolidation is at the end, direction will emerge this week. If the upper edge of 118500 is effectively broken, follow the pullback, looking above at 121000-122700. If constrained by 118500, the probability of a downward break is high. Watch for buying opportunities in the range of 113700-113000 and 111400-110500!

ETH

Pay attention to whether H1 breaks below 3680 to form structural damage; if it breaks, then the rebound to 3730-3800 is a good entry point for short positions, targeting around 3633, and if broken, continue to watch 3579-3477! As long as 3477 does not break, H4 remains an upward structure, so there is still an opportunity to capture rebounds! Once 3477 breaks, it will start a retracement cycle!

SOL

195 has arrived as expected, currently retracing to 195-193 without breaking, the next target is around 220! If it breaks 193, then wait for buying opportunities around 178-173!