Current market indicators show that Bitcoin is in a consolidation and potential correction phase. Major indicators such as exchange inflows, momentum, and the market value to realized value ratio (MVRV) of short-term holders all show signs of slowing market momentum and increasing selling pressure, so traders should remain vigilant. In addition, changes in miner revenue and the cooling of SOPR momentum further suggest that demand for high-priced Bitcoin may be decreasing.

For momentum traders, it is critical to keep a close eye on these downtrends. If the market shows signs of recovery or stabilization, such as a reversal in indicators such as SOPR and Profit Feed, this may provide a strategic entry opportunity. However, the increasing realized losses remind us to remain vigilant to possible panic selling. These analyses help us better understand the current market state and make more cautious investment decisions.

Policy

After the interest rate hike is suspended, risk assets tend to strengthen. Historically, after the Fed suspends interest rate hikes, the economic cycle tends to enter a recession because the economy is either overheating or in recession. The interest rate hike is to deal with the overheating of the economy, which will then face a downturn or even recession, and then recovery, overheating again, and so on. After the interest rate hike is suspended, the economy may enter a recession. The Fed will cut interest rates when it sees that the economy is in recession, and may even enter a continuous interest rate cut channel. The initial interest rate cut is not a good thing, just like the initial interest rate hike, because the market has encountered problems.

The market is currently looking at economic data or employment data. If it gets worse, everyone will be happy and the market will rise, but if it gets too bad, everyone will worry about entering a recession and withdraw. Therefore, the data in the next period of time will be very critical.

From a macro-cyclical perspective, if the current economic situation can be maintained and does not go down, it would be the best situation. Because once the economic momentum goes down, it will enter a trend of getting lower and lower, leading to panic.

It is expected that the BTC price will show signs of correction in the future

The price of Bitcoin is now strongly correlated with two factors: the inflow and outflow of ETFs and the trend of U.S. stocks. As shown in the figure below, the total net inflow of Bitcoin spot ETFs was $108 million yesterday, which has been a net inflow for 9 consecutive days. There is no sign of waterproofing of funds. Once the inflow is weak again, it may cause shocks or declines.

Currently, Ethereum has passed the 19b-4 document for the Ethereum spot ETF. Funds are expected to be on ETH. Ethereum will usher in big ups and downs, and BTC will be slightly weak for the time being.

Spot traders, buy at low prices; according to the principle of symmetry, the first expected decline range of Bitcoin is around 6.5; Ethereum 3300-3400.

I also said in my article this morning that the stock would fall, but I didn’t expect it to start going downhill in the afternoon.

Where will BTC top out in this cycle?

From the perspective of miners’ profits, high profits help miners recover cash flow and prepare for upgrading to higher computing power. According to calculations, when BTC reaches more than 90,000 USD, mainstream mining machines can quickly recover their investment in 12-16 months. This is the threshold of “high profits”. At the same time, the integer mark of 100,000 USD is also an integer psychological mark expected by most people, so 90,000-100,000 USD is an important price range.

Starting from the chip structure; currently there are 2.6 million BTC in the 60,000-67,000 USD range, accounting for 16% of the total circulating market. This is a huge accumulation area, indicating that a lot of chips are changing hands here. If the chips here are not fully digested in the future, then when the BTC price reaches 120,000-130,000 USD, it means that the chips here have an average of 200% unrealized profit. The trading psychology of "doubling the principal" will easily cause the market to generate concentrated selling pressure at this position.

A BTC top price algorithm model can also be risked to everyone here:

The algorithm model does not mean that this cycle will definitely reach the predicted position, but it can only be said that the model has never made mistakes in the verification of historical data. On March 14, the model estimated that the peak of this round was around $134,000; and by May 22, the top price had moved up to $146,800. This is an Easter egg for your reference.

Later, I will bring you analysis of leading projects in other tracks. If you are interested, you can click to follow. I will also organize some cutting-edge consulting and project reviews from time to time. Welcome all like-minded people in the cryptocurrency circle to explore together. If you have any questions, you can comment and ask questions