Before we begin, we need to take stock of the sentiment trend of the macro market in the past two days. Since yesterday, when Fed Chairman Powell gave a speech at the European Central Bank Forum, the market has started a new round of decline. At this time, you may ask: Is it this hawkish policy that disturbs the market again? In fact, it is not the case. In this round of speeches, Powell did not respond positively to the interest rate cut, but responded positively to the achievements of other industries such as housing, employment, and banking, as well as future expectations.
Why did it start falling again?
A butterfly flapping its wings twice in the northern hemisphere may cause weather changes in the southern hemisphere. This is just the inevitable result of a series of chain reactions. Although Powell was neutral in his speech this time, he still avoided talking about interest rate cuts, which means that interest rate cuts are still a long way off at this stage, and even optimistic traders still cannot see hope in the short term. To make matters worse, it happened to be the Independence Day in the United States. The trading volume further decreased, and traders who should have been on the sidelines began to panic sell. Among them, Grayscale GBTC outflowed $32.4 million in 2017, and shorts dominated the market in 2017.
With the support of the market, the short position is expected to continue.
Even if you don't want to admit it, the market trend structure has been formed, and a new round of daily level decline will begin. Although this round of decline did not break through the 6W integer support of the big cake, it destroyed the upward channel that was formed with great difficulty on June 29, and the structure collapsed. Here we can directly focus on the 2-day level trend, which is also a very critical short opportunity mentioned by Farsight in the last round: the strong support at MA120 below. Now it is obvious that the upper side is suppressed by the short-term trend line MA12. The intraday decline makes the future market even more hopeless. Then, combined with the daily level trend and the escape from the top near the approval of the Ethereum ETF, once the 6W support is broken, the short position will accelerate in the short term.
The bears will complete the bottoming and the bulls will take over the market.
Yuanjian believes that this round of decline will form a new bottom on the market. First of all, the macro market direction, the outflow of ETFs and even the end, after the approval of the Ethereum ETF, will form a new round of strong buying points, especially referring to the approval of the last round of Bitcoin ETF, with a daily net inflow of more than 1 billion US dollars and a cumulative inflow of more than 15 billion US dollars. At that time, the market value of Bitcoin was at a high point, and traders had doubts about the upper space. Now Ethereum is in an active market period, and there is nearly 30% upside space from the previous high alone, and nearly 50% upside space from the historical high. Imagine, if you are a US stock trader, what would you choose when you see this data?
