August 2, 2025 Market Analysis
In the past 24 hours, it has been another painful day, with the crypto market experiencing a liquidation of 759 million USD, affecting over 180,000 people. This liquidation volume has already reached half of the bull market risk threshold. I mentioned earlier in (liquidation of 500 million, this drop is the trumpet for the bull market to continue advancing!) that when the 24-hour liquidation volume exceeds 10 billion RMB, it is one of the signals that the bull market may reverse. Based on this indicator, this drop still belongs to a correction; however, the cumulative correction of Bitcoin and Ethereum has already been around 10 points, which will definitely have a significant impact on the market.
Looking at the overall situation, last night's second drop was more influenced by the US stock market. The Nasdaq opened lower and continued to decline, with a daily drop of 2.24%. The hardest hit were cryptocurrency-related stocks, among which the well-known Coinbase fell by 16.7%, and MicroStrategy fell by 8.77%. Some conceptual stocks related to MicroStrategy experienced even more outrageous pullbacks. A few days ago, I mentioned that investors are well aware of the significant bubble in this wave of coin-stock concepts. Many companies hope to achieve backdoor listings or offloading by buying coins, which will ultimately lead to chaos. However, it was unexpected that the US stock market had such an impact, causing the de-bubbling process to occur much earlier.
The direct reason for the recent decline in the US stock market is the 'falsification' of non-farm data, with the May figure revised down from 144,000 to 19,000 and the June figure revised down from 147,000 to 14,000. However, this is actually a signal of real economic weakness, which should be beneficial for interest rate cuts expected in September. The market is mainly concerned about data falsification, leading to risk-averse behavior. Another significant impact is the US-China trade issues. Since the last 'extension of 90 days', Trump's tariff policies have begun to show results, but China has not shown a clear attitude of concession, making the market worry whether another crash will occur.
Anyway, the US stock market has indeed shown a daily jump and then a decline. Fortunately, Bitcoin has not yet broken through the important support level of 110,000, and last night's drop was a continuation of the previous day's decline. Therefore, we need to observe the emotional recovery over the weekend and any new actions from the Trump administration. Having learned from past experiences, I believe there's no need to worry. Even if this wave continues to drop, the probability of a subsequent rebound is very high, because Trump is a super player in the US stock market, and he cannot just watch the stock market crash. As for the market situation, Ethereum has reached 3,500 USD, which is also a relatively important support level. We can first look at Bitcoin; if Bitcoin breaks below 110,000, then the subsequent market situation will be quite pessimistic. If you have high-position reductions, you can buy in during the pullback process. Looking back, this wave of market was also a failure to break through Ethereum's resistance level, but I think since we have held on until now, we should not give up easily.
Thank you for your attention and likes.