The ups and downs of the market fully demonstrate the embarrassing situation of insufficient capital inflow into the market; it can neither go up nor go down - the main contradiction at present lies in the profound contradiction between people's growing demand for purchasing Bitcoin and the serious lack of market liquidity!
The market is more cautious and rational than before. The liquidity is insufficient. We need to wait for the continuous increase brought by ETFs to build more consensus in the circle. We also need to wait for a new era of liquidity to push up the liquidity in the circle.
Unfortunately, this can be a long process!
Judging from the data of the last two cycles, this "transition phase" may last 1-2 years. The 2016-2017 cycle lasted 335 days, and the 2019-2020 cycle lasted 590 days; this cycle has lasted 189 days so far. Compared with the shortest cycle in 2016-2017, there is still a gap of 146 days, or about 5 months.
If we combine macro factors, assuming that the Federal Reserve will start its first interest rate cut in September this year, and then enter the US election cycle, then BTC may end the above-mentioned "transition phase" in October, which seems to be exactly 5 months. Conversely, in this "transition phase", whenever LTH-MVRV approaches 3.5, it will be a resistance level in the market, that is, the seller pressure will become stronger.
In the current market environment, meme is the main force, RWA is the auxiliary, and the rest are not doing well, or the sector rotation has not yet reached certain tracks. Yesterday, the Ethereum ecosystem Meme coin pepe in a memes world (PEW) went online and rose by more than 144x. Every day, new memes come out, and every day, a lot of memes return to zero. Everyone must find a rhythm that suits them when playing memes
The surge in meme coins shows that the market lacks narrative
Currently, the Ethereum ETF narrative has been suspended. The market is waiting for the approval of the S-1 document. After it is approved, it will be officially listed and traded, and traditional funds will enter the market to pull up the price.
But is it selling the news or just a direct increase? No one can tell for sure.
Some people believe that after Ethereum is approved, it will plummet like Bitcoin due to various selling pressures, and short-term investors will also choose to sell
Some people think that the market will rise directly, because Ethereum is different from Bitcoin. Ethereum passed a document first. This cycle provides enough buffers, and various negative factors will be digested.
Bitcoin fell yesterday due to the unusual movement of the Mentougou compensation wallet. After a day of retracement, it received obvious support near 67,300 yesterday and is currently on its way back to the 70,000 USD mark. The current market does not allow for a deep retracement because the market sentiment has been fully mobilized. Bitcoin will continue to rise at the 4-hour level and challenge the 70,000 mark again, and then the new high of 73,777.
In short, May is about to pass. I have said before that every pullback is the best opportunity. After May, there will be no more opportunities to hold cheap stocks.
The market trend is often opposite to what most people expect, so an unexpected direct rise is more likely.
Of course, these are just predictions. As practitioners of long-termism, we only buy and do not sell now, so we can accept any short-term market decline.
As long as we can eat the fattest piece of meat at the end, that's enough.
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