I believe the current market adjustment is a necessary cleansing process, not only clearing out excessive speculative leverage but also allowing the chips to flow back into the hands of large holders, especially retail investors who entered the market in the last two to three months, who are currently facing tremendous pressure. Large holders typically use two strategies to exploit the market's fear sentiment. One strategy is to increase selling pressure to create a market downturn, triggering massive liquidations in a thin market, further exacerbating the market's downward trend. When panic selling reaches its peak, large holders take the opportunity to acquire Bitcoin at low prices. Meanwhile, although long-term holders of Bitcoin are still selling, there are also short-term holders buying, although the buying power has decreased compared to before. The SOPR of short-term holders can help us observe whether they are trading at a profit or a loss. When the SOPR value is above 1, it means that short-term holders are selling at a profit overall, while when the SOPR value is below 1, it indicates they are selling at a loss. With the recent pullback in Bitcoin's price, the SOPR indicator for short-term holders has fallen below the key level of 1. When short-term holders realize that selling their chips now will lead to losses, they typically face two choices. On one hand, they may choose to continue holding, hoping for a price rebound to avoid losses. Since this group's selling weight is significant, it can reduce Bitcoin's downward pressure. However, the previously mentioned area of $97,000, this important support level was once lost but has now been regained. In such cases, short-term holders usually choose to hold rather than sell at a loss. Once Bitcoin rises near their cost line, some will quickly choose to sell at break-even, leading Bitcoin to hover around this level.

If we want to break through $100,000 and further recover upward, we still need to wait for American investors to become active. Of course, retail investors who entered the market in the last two to three months have another option, which is to choose to cut losses and exit to reduce further losses. Therefore, it is important for Bitcoin to remain at a relatively safe level in the absence of American investors. This wave of Christmas rebound has come very timely, reducing our risk of falling below the 50-day moving average.

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