Last night, Bitcoin reached 62,000 at a small level. It is very normal for the market to pull back at this time. The callback price and the falling volume are all small and short columns. The dealer did not drop the volume. With the start of a new week, Bitcoin soared sharply at 8 am this morning (14th). At the time of writing, the price hovered at 64,400 US dollars, an increase of 2.62% in 24 hours.
The current price is hovering around $64,400. If it breaks through and stabilizes at the height of 64,450, we will have to start looking at it again. This is also the last empty point in the current stage. Since it is above the height of this K column, I personally suggest looking at the closing of the next K column. It is worth mentioning that although Bitcoin and the stock market are somewhat decoupled, we should also pay attention to the trend before and after the opening of the US stock market in the evening. If Bitcoin can follow the US stock market next, there will be a chance to see further increases. At present, the general trend direction remains unchanged, and small-cycle corrections should be cautious not to sell at a loss.
Is this bull market not as explosive as the last one?
The main reason is that the pace of money release this time is different from the past. Looking back at the 2020 epidemic, in order to cope with the huge impact on the global economy, the Federal Reserve quickly took measures to cut interest rates, cutting interest rates by 150 basis points in just one month, and other countries quickly followed suit. This series of strong stimulus policies has caused the price of Bitcoin to explode in the short term, soaring from less than $10,000 to $65,000, a 20-fold increase.
But as countries gradually tightened their monetary policies, Bitcoin's upward momentum came to an abrupt halt at the end of 2021, and eventually rebounded slightly to $69,000, almost the same as its high in April 2021.
In contrast, the pace of monetary easing in this round of bull market is slower. It is expected that in the next six months, the Federal Reserve will gradually cut interest rates by 200 basis points, rather than quickly lowering them to the bottom as in 2020. The gradual pace of monetary easing means that the rhythm of this bull market is more like that of 2017, and the market will continue to rise for a longer period of time, rather than a rapid surge in a short period of time.
From March to September this year, the performance of the Bitcoin market was relatively flat. This was mainly because the Federal Reserve had not taken any actual action and the market lacked incremental capital support, causing the price of Bitcoin to remain sideways during this period.
Looking ahead to this week's macro news in the market:
Looking ahead to this week, the market will pay close attention to China's GDP data for the third quarter of 2024, which will be released on Friday (18th). On the other hand, the United States will also usher in a super earnings week, and many Federal Reserve officials will give speeches this week. At the same time, the European Central Bank will announce its interest rate decision on Thursday, and the president will host a monetary policy press conference.
October has always been the strongest month for Bitcoin and cryptocurrency markets, but there are still many uncertainties in the market, such as the shooting competition between North Korea and South Korea, etc. We should be cautious about this.
The interest rate cut cycle has begun and a big market trend is on the way. What is the best investment strategy at present?
The short-term strategy can be more conservative. There are no catalysts in the market before the election. The overall market may have a clear direction after the interest rate cut in November and the election. Assets still depend mainly on the election. There is currently no obvious improvement in the liquidity of the altcoin market, and the structural problems of the altcoin have not been solved. The core promoters of the meme sector are also facing some problems. There may be fewer high-quality opportunities than before, and subsequent economic data and elections will be needed to bring some breakthroughs.
If BTC cannot achieve a breakthrough, the outlook will be even less optimistic. Therefore, despite the continued rise of BTC.D, the BTC-based strategy still has investment significance. On this basis, investing small-scale funds in some hot tracks (such as Meme) is a better combination.
Hold on to your chips.
The long-term interest rate cut process will gradually bring liquidity back to the risky market. The best investment strategy is to remain rational and calm and avoid over-selling valuable positions.
Even if we put aside factors such as the Fed’s rate cut and the US election, we can still expect BTC to have a relatively good performance in the fourth quarter.
1. As mentioned earlier, October is usually a month with better performance in the cryptocurrency market, and investors even nicknamed October "Uptober".
2. The effect of interest rate cuts has not yet emerged
The interest rate cuts started by the US Federal Reserve last month are likely to bring more capital inflows to the cryptocurrency market. Analysts at JPMorgan Chase pointed out that the potential impact of the Fed's interest rate cuts has not yet been shown, and the correlation between the overall market value of the cryptocurrency market and the US federal benchmark interest rate is still weak, at 0.46.
In mid-September, the SEC approved BlackRock to list and trade options for the Bitcoin spot ETF on the Nasdaq. Through options trading, investors can now participate in the ETF in a more flexible way, thereby indirectly increasing the liquidity of BTC.
As for the pace of subsequent interest rate cuts, it is still related to the non-farm unemployment rate in the US market. The current non-farm unemployment rate is deeply coupled to inflation, geopolitics, etc. to some extent (for example, the recent conflict in the Middle East has led to price fluctuations in logistics and some bulk commodities, which indirectly affected US inflation and indirectly affected the recruitment rhythm of US companies). My personal advice is not to bet on the extent of the Fed's interest rate cuts, but to be flexible!
Talking about the copycat market, the weekend trend is still meme. This track has gone through countless cycles. This wave is the turn of bome and slerf period projects. New memes are also emerging frequently. The previous AI meme turbo was also listed on Binance. The third and fourth leaders of the AI meme track will definitely come out one after another.
In short, the gameplay of meme is so rich, and its wealth-creating effect is no weaker than the 2020 DEFI SUMMER. If you don’t enter the meme circle now, you will really feel out of the currency circle. In addition, the rune sector has also been very strong recently. Now I feel that inscriptions and runes should be on the same track as meme. If meme chases high, you might want to take a look at runes!
