Weekly Review
This week, from May 20 to May 27, the highest price of BTC was around $71,979 and the lowest was close to $67,969, with a fluctuation range of about 7%.
Observing the chip distribution chart, there are a large number of chips traded around 65,000, which will provide a certain amount of support or pressure.
• analyze:
1. 59000-63000, about 980,000 pieces;
2. 64000-68000, about 1.08 million pieces;
• The probability of not falling below 57,000-61,000 in the short term is 82%;
• The probability that the price will not break through 71,000-74,000 in the short term is 67%.
Important news
Economic News
1. JPMorgan Chase said: Strong performance from AI darling Nvidia and steady economic growth mean the S&P 500 may have room for further gains.
2. Bank of America data showed that $10.5 billion flowed into the U.S. stock market in the past week; cryptocurrency funds attracted the fifth largest inflow on record, reaching $1.4 billion.
3. Waller, a popular candidate for the next head of the Federal Reserve, believes that the possibility of re-acceleration of inflation can be ruled out. If the data supports it, a rate cut may be considered at the end of the year. The idea of only cutting interest rates once does not make much sense. The April inflation data shows that progress toward the 2% target may have resumed, and the lack of acceleration in inflation is a reassuring signal.
Encrypted Eco-Messages
1. The U.S. House of Representatives voted for the first time on the 21st Century Financial Innovation and Technology Act (FIT21), which aims to reshape the digital asset regulatory landscape, give the Commodity Futures Trading Commission (CFTC) greater digital asset spot market power, and create new jurisdictional boundaries for the Securities and Exchange Commission (SEC).
2. Grayscale ETH Trust (ETHE) had a trading volume of US$687 million on the 21st, a new high since May 21. The previous high was US$842 million on May 19, 2021.
3. Lyra founder and former Wall Street options trader Nick Forster said that the options market shows that the probability of ETH reaching $5,000 before June 28 is about 20%, and the probability of exceeding $5,500 before July 26 is also 20%.
4. Nasdaq documents show that Billionaires filed a revised Form 19B-4 for ETH spot ETF, which will exclude ETH pledge. Bitwise filed a revised Form 196-4, planning to launch an ETH ETF on the New York Stock Exchange (NYSE).
5. Gary Gensle, director of the U.S. Securities and Exchange Commission (SEC), reiterated that the cryptocurrency market is rife with fraud, that there are "serious conflicts of interest" among cryptocurrency trading platforms, and that the cryptocurrency market needs "referees on the field."
6. Cointelegraphresearch said that industry observers said that the U.S. Securities and Exchange Commission (SEC)'s approval of the spot ETH ETF shows that it recognizes that ETH is a non-security type.
7. The U.S. Securities and Exchange Commission (SEC) approved the 196-4 documents of 8 spot ETH ETFs on Friday. An SEC spokesperson said that the agency would not comment on anything other than the approval order for the spot ETH ETF.
8. The listing of ETH spot ETF requires approval of both 196-4 and S-1, and is currently waiting for the approval of S-1. ETF issuer VanEck has submitted the revised S-1 application document for spot ETH ETF as soon as possible.
9. Bloomberg ETF analyst James Seyffart said that the S-1 approval for the ETH spot ETF may be completed "within a few weeks", a process that usually takes up to five months.
10. ETF analyst Eric Balchunas said that mid-June is definitely possible, and it is expected that there will be only one round of comments on the S-1 amendment, similar to the feedback provided by the SEC to spot BTC ETF applicants. This process will take about two weeks.
Long-term insight: used to observe our long-term situation; bull market/bear market/structural change/neutral state Mid-term exploration: used to analyze what stage we are currently in, how long this stage will last, and what situation we will face Short-term observation: used to analyze short-term market conditions; and the possibility of certain directions and certain events occurring under certain conditions
Long-term insights
• BTC net inflow/outflow distribution on different exchanges • Large inflow/outflow net positions on exchanges
• Different long-term holders’ holding structure • Total chips distribution structure on the chain
The increase in net inflows to offshore exchanges means that they are the main source of short-term market pressure.
Recently, as prices have risen, large net positions (above $10 million) have shown an obvious net inflow trend at high levels, indicating that large holders are gradually selling BTC for profit.
Smaller net positions (US$1-10 million) show a certain net outflow trend, but the magnitude is relatively small.
A large amount of Bitcoin is accumulated in the price range below $60,000, which indicates that in the previous market correction, a large amount of BTC was purchased by holders at a lower price range and held for a long time.
There is some selling pressure above 70,000 or 71,500, and if prices continue to rise in the short term, they may encounter resistance in these areas.
Market Outlook
Pressure and opportunity:
The net inflow from large holders indicates that there is a certain amount of selling pressure in the short term, which may put short-term pressure on prices.
Especially in the price range above $70,000, there is a certain amount of selling pressure.
The increase in net inflows on offshore exchanges indicates that the market has some pressure on prices around $70,000, while US exchanges show buying at a relative low.
Participants who have been in the market for 3-5 years have become the backbone of the market, ensuring the stability of the market.
Those who are more conservative need to pay attention to the movements of large holders and the market's ability to absorb the volatility, and adjust their positions if necessary to cope with short-term fluctuations.
And whether to invest some funds above 70,000-71,000 to smooth out volatility risks.
Mid-term exploration
• Accumulation trend points • Whale exchange net position
•1-6 month realized profit ratio •6 month realized profit ratio •Network sentiment positivity •ETH exchange trend net position
The accumulation situation in the field has eased slightly, and the overall situation has escaped from the poor accumulation state and eased slightly.
Perhaps, it will still take time to truly restore the accumulation status, and the market still has a certain degree of caution.
The outflow of whale from exchanges has slightly weakened, and some whale may be in a mild wait-and-see position.
The profit and loss ratio is calculated as:
The Net Realized Profit/Loss metric calculates the percentage of net profit or loss across all mobile coins within the respective age group.
Use profit and loss dynamics to understand the sell-offs of different age groups.
Green area: When the profit and loss ratio of participants from 1 day to 6 months is on the rise, it is displayed in green.
ETH is currently at a relatively high profit-loss ratio stage and is in an upward zone, and may require incremental funds to drive it forward.
Otherwise, excessive profit-taking may cause the market to be unable to take over, leading to a dilemma of insufficient momentum to push higher.
The net position of ETH in the exchange trend shows that a certain amount of ETH is charged into the exchange, which may form potential selling pressure or the behavior of whale sorting out their wallets.
It is necessary to pay attention to the volatility risk in the short term, and the market may be affected by potential pressure.
Short-term observation
• Derivatives risk factor • Option intention transaction ratio
• Derivatives trading volume • Option implied volatility • Profit and loss transfer volume • New addresses and active addresses • Net position of BTC Exchange
• Net position of the ETH Exchange
• High-weight selling pressure • Global purchasing power status • Stablecoin exchange net positions
• Off-chain exchange data
Derivatives Rating: The risk factor is in the neutral area. The derivatives risk is moderate.
The news of ETH's ETF has a greater impact on the market recently, so this week we will observe the risk factor of ETH derivatives.
The risk factor is close to the red area, and in the short term it is close to the market high. The current risk factor is below the neutral area. It is expected that there will be little room for sustained short squeeze this week, and it may be more inclined to fluctuate upward.
Options volume fell slightly, with put options ratio in the middle.
Implied volatility fell slightly.
Emotional state rating: Neutral
Although the market rose significantly last week, the current market positive sentiment and panic sentiment are at a relatively low level. Market sentiment is still at a relatively neutral level, and the cost of short-term holders has not risen rapidly at present, still around 61K. This week, it is expected that the focus will be on observing the positive sentiment indicator (blue line). If it continues to decline, the market will tend to fluctuate more.
New and active addresses are at a low level.
Spot and selling pressure structure rating: Overall, there is a small inflow and a small amount of selling pressure.
The net position of BTC exchanges is in a state of small inflow.
There is no high-weight selling pressure for the time being.
Purchasing power rating: Global purchasing power has rebounded slightly, and stablecoin purchasing power has remained basically the same.
Consistent with last week, the current purchasing power in the Americas has recovered slightly, but the purchasing power in Asia and Europe is still in a state of loss. But overall, the purchasing power in the Americas is dominant.
USDT net position remained flat overall.
Off-chain transaction data rating: There is a willingness to buy at 65,000; there is a willingness to sell at 71,000.
There is a willingness to buy at prices around 60,000 and 65,000;
There is a willingness to sell at prices around 71000, 72000 and 73000.
There is a willingness to buy at prices around 60,000 and 65,000;
There is a willingness to sell at prices around 71000, 72000 and 73000.
This week’s summary:
Summary of the news:
1. The market is better than expected in the medium term; the 196-4 documents for 8 spot ETH ETFs were approved suddenly and slightly unexpectedly, followed by the approval of the S-1 document.
2. The sudden approval of the document may have an impact; next, the market maker will purchase a certain amount of ETH spot to supplement liquidity.
3. The fastest approval time for the remaining S-1 documents is about two weeks, which means there is only one round of comments and feedback corrections. If it is slow, it may take about 5 months.
4. Before and after the listing of ETH ETF, there may be a certain amount of capital inflow and institutional allocation.
5. The crypto narrative in the medium term will be interspersed with the main line of ETH's ETF approval, and then the main tone of the narrative will be interest rate cuts, which is much better than the expected single main line of only "interest rate cuts" and "halving".
Because from the statistical chart, September and October are generally relatively sluggish periods for the US stock market. If we completely follow the US stock market, the mid-term market may become relatively sluggish and dull. In the long run, once the Fed starts to loosen its monetary policy, it will be difficult for the crypto market to directly enter a long-term sluggish deep bear market. This is another relatively optimistic news and expected change in the long run.
Long-term insights on the chain:
1. US exchanges are buying at the pullback lows, while Asian exchanges are currently the main selling force;
2. At present, above 70,000, there will be large participants selling;
3. Investors with 3-5 years of experience continue to support the market, and investors with more than 2 years of experience have not changed much, and the market structure is relatively stable;
4. Below 60,000, the chips are distributed densely and there is accumulation, which is a good price range.
• Market setting tone:
Market sentiment is still optimistic and support is firm.
On-chain mid-term exploration:
1. The accumulation trend in the market is weak;
2. The whale may be in a mild wait-and-see phase;
3. The market needs additional funds to break through the existing difficulties;
4. On-chain sentiment slowed down slightly;
5. There is a certain amount of ETH stuck inside the exchange, so be cautious.
• Market setting tone:
The pace of the market has slowed down, the accumulation is weak, and the growth rate of on-chain enthusiasm has slowed down.
On-chain short-term observations:
1. The risk factor is in the neutral area and the risk is moderate.
2. The number of newly added active addresses is at a relatively low level.
3. Market sentiment status rating: Neutral.
4. The net position of the exchange as a whole shows a small inflow, and the selling pressure is general.
5. Global purchasing power has recovered slightly, and the purchasing power of stablecoins has remained basically the same.
6. Off-chain transaction data shows that there is a willingness to buy at 65,000 and a willingness to sell at 71,000.
7. The probability that the price will not fall below 57,000-61,000 in the short term is 82%; the probability that the price will not rise below 71,000-74,000 in the short term is 67%.
• Market setting tone:
The overall market sentiment is neutral, and the purchasing power is basically the same as last week. A small amount of selling pressure is beginning to appear. The overall expectation is that there will be less room for a large-scale short squeeze this week, and it is more inclined to fluctuate upward. The probability of a large-scale decline in the market is still very low.
Risk Tips:
The above are all market discussions and explorations and do not have any directional opinions on investment; please be cautious and prevent market black swan risks.
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