The embarrassing situation of insufficient capital inflow in the market fully demonstrates the current market dilemma: the rise is weak and the fall is weak. The main contradiction lies in the growing demand for people to buy Bitcoin, while the market liquidity is seriously insufficient.
The current market is more cautious and rational than before, but the water release is insufficient. We need to wait for the continuous increase brought by ETFs to form more consensus in the industry. At the same time, we also need to wait for a new era of water release to improve liquidity in the industry.
Unfortunately, this may be a long process. According to the data of the past two cycles, the duration of this "transition phase" may be 1-2 years. The 2016-2017 cycle lasted 335 days, and the 2019-2020 cycle lasted 590 days. The current cycle has lasted 189 days so far. Compared with the shortest 2016-2017 cycle, there is still a gap of 146 days, that is, about 5 months.
Considering macro factors, if the Federal Reserve starts its first interest rate cut in September this year and then enters the US election cycle, then Bitcoin may end this "transition phase" in October. In terms of time, this seems to be exactly 5 months. On the other hand, in this "transition phase", whenever LTH-MVRV approaches 3.5, the market will encounter resistance, that is, the seller pressure will increase.
In the current market environment, meme is the main force, rwa is auxiliary, and the rest are not very good, or the sector rotation has not yet reached certain tracks. Yesterday, the Ethereum ecosystem Meme coin pepe in a memes world (PEW) went online and rose by more than 144x. There are new memes coming out every day, and there are also a lot of memes returning to zero every day. Everyone must find a rhythm that suits them when playing memes
