Hello everyone! A new day, a new opportunity, welcome to today’s morning review session, I am your old friend Web3 Beast! First, let’s review the market dynamics of the past few days.
On the 23rd, the cryptocurrency market experienced a thrilling plunge. The entire market was immersed in a panic, and the price fell all the way, bottoming out at 38,500. However, at night, the price rebounded dramatically to around 40,000 and fluctuated around this level for nearly two days, with both long and short sides deadlocked in this game.
This plunge makes us wonder: Is the market about to choose a clear direction? Or is this shock just a prelude to a larger fluctuation?
From a macro perspective, the discount space of Grayscale GBTC is gradually shrinking, and the market selling pressure has also eased. Within 6 days after the opening of the ETF, the total transaction volume has exceeded 16.6 billion US dollars, and more than 1.2 billion US dollars of funds have continued to flow in. However, it should be made clear that the transaction volume of the ETF is not equivalent to the overall capital flow of the BTC trading market. Only the funds that actually enter the BTC transaction will have a direct impact on the market.
When we use the ETFNAV on January 19 as a benchmark and compare it with the closing price on that day, we can see that among the 11 Bitcoin spot ETFs, 5 are currently in a discount state, that is, the market price is lower than its NAV. Among them, BRRR has the highest discount rate, reaching 0.51%, while FBTC, EZBC and BTCW have similar discount rates, all exceeding 0.3%. In contrast, GBTC has the lowest discount rate, about 0.27%.
Some investors may be taking advantage of this discount to buy GBTC, while some OTC shorts are shorting BTC for arbitrage. This arbitrage behavior is believed to be one of the reasons why GBTC is facing high selling pressure. However, at the current discount rate, the space for this arbitrage activity has further narrowed. It is expected that the impact of this arbitrage activity on market selling pressure will gradually weaken in the future.
BTC Market Analysis
By observing the market, we found that the current market is in a downward channel. However, the fluctuation position in the past two days is just near the previous low point, which makes the market dynamics particularly subtle. According to the top and bottom transformation principle, when yesterday's high failed to break through the previous high point, the market has already indicated that it may explore a new low again. However, yesterday's market trend was unexpected. It did not continue to fall, but returned to the fluctuation range and showed signs of a breakthrough in the morning.
Although technical indicators sometimes lag behind, the self-healing of the market is an inevitable process. The four-hour MACD indicator may be foreshadowing the arrival of a wave of repair market. Therefore, from the perspective of short-term operations, it is recommended that long operations during callbacks are a relatively safe strategy. You can go long at any point below 40,000 and set 39,300 as the stop loss point. The upper resistance level needs to pay attention to 40,800-41,000/41,700, and investors can grasp the operation according to their own judgment.
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