Weekly Review
This week, from July 15 to July 22, the highest price of BTC was around $68,474 and the lowest price was close to $60,632, with a fluctuation range of about 12.9%.
Observing the chip distribution chart, there are a large number of chip transactions around 65,000, which will have a certain support or pressure.
• analyze:
1. 59000-63000, about 1.33 million pieces;
2. 64000-68000, about 1.17 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. The ECB’s interest rate decision maintained the three major interest rates at 4.25%, 3.75% and 4.5% respectively.
2. Among them, the main refinancing rate is 4.25%, expected to be 4.25%, and the previous value is 4.25%.
3. European Central Bank President Christine Lagarde said: There will be more information in the coming weeks and months. It will be a busy summer. What to do in September is completely open. There is no preset interest rate path. The door to (rate cut) in September is open.
4. UBS, HSBC, Deutsche Bank, Bank of America and others believe that the European Central Bank will cut interest rates in September.
5. Economist Stefan Gerlach said that since the Federal Reserve may cut interest rates in September, the European Central Bank will also do so, and it is expected that the European Central Bank will cut interest rates again in December or January next year.
6. Bank of America said: It is expected that the European Central Bank will cut interest rates by 75 basis points in total in 2024, with one cut each in September and December, and a total of five cuts in 2025.
7. The Federal Reserve has entered a quiet period before its interest rate meeting on July 30. It is expected that the new monetary policy statement at the July meeting may change the description of the economy and outlook, laying the foundation for a rate cut in September.
8. On Wednesday, Fed Governor Waller said that interest rates will be cut in the "near future". Before the upcoming July policy meeting, Fed members believe that inflation may continue to slow, and if inflation slows, a rate cut would be appropriate.
9. Investors are focusing on the Federal Reserve's September meeting, when the central bank is expected to start cutting interest rates. Fed chief Powell said this would mark a "significant" shift in monetary policy, from a tightening cycle to fight inflation to an easing phase.
10. Ahead of the upcoming July policy meeting, Fed members believed that inflation was likely to continue to slow and that a rate cut would be appropriate if inflation slowed.
Encrypted ecological news
1. The results of the Reddit survey show that about 260 MtGox creditors (56% of the 467 survey participants) plan to continue holding BTC after receiving compensation, and 88 creditors (about 20% of all survey members) said they will sell all the BTC paid. This survey may reflect the overall sentiment of MtGox creditors.
2. Media reports said that the first batch of spot ETH ETFs may be launched next Tuesday (July 23).
3. As issuers have successively submitted S-1/A and other documents of spot ETH ETFs to the U.S. Securities and Exchange Commission, the fees of the 9 spot ETH ETFs have been announced. The fee of BlackRock's spot ETH ETF is 0.25% (0.12% for the first US$2.5 billion or the first 12 months).
4. Bitwise CIO Matt Hougan said that the price of ETH is expected to fluctuate in the first few weeks after the ETH ETF goes online, as funds may flow out of the trust after the $11 billion Grayscale ETH Trust is converted into a spot ETF. He believes that the price of ETH will exceed $5,000 by the end of the year and set a record high.
5. Citi's report shows that the net inflow of ETH spot ETF in the first 6 months ranged from 4.7 billion to 5.4 billion US dollars.
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
• US crypto ETF wallet net positions • Exchange large net positions • Profit levels of long-term and short-term participants
Judging from the total number of ETF wallets, there is still a positive premium, and people are still buying over-the-counter ETFs.
Large net positions on exchanges began to show outflows, which is a relatively good concept, indicating that large participants began to buy continuously.
The market's purchasing power is gradually recovering.
The 250% profit of the long-term players indicates that the market's periodic pressure may be between 695,00 and 70,000, and the market risk should be paid attention to around this price.
The market will generally linger and oscillate around the stage price, and only when it accumulates enough energy can it continue to break through.
Mid-term exploration
• Price level structure analysis model • Liquidity supply • Incremental model • Network sentiment positivity
Regarding the upper and lower limits of the market, general market laws apply when the market is determined by liquidity.
The upper and lower limits of the market are calculated through short-term costs, which are around 91,000 and 49,000 respectively.
At this time, the market will be in a liquidity channel, strongly correlated with supply and demand.
Similarly, when the market is in an incremental trend, the upper limit value may be broken. If the market is in a leveraged liquidation, a poor cycle, or a crisis such as a black swan occurs in the market, the lower limit value may be broken.
When the market breaks the lower limit, it may be a relatively cost-effective position for holders of 3-5 years to increase their holdings. When the market breaks the upper limit, it may be necessary to consider selling some of the shares.
The liquidity supply has increased slightly, and it has increased again on the previous basis.
Possibly, continuous liquidity injection will raise the market ceiling and make upward movement smooth.
Perhaps the current problem in the market is that the overall trend of short-term participants is unclear.
However, the increase in the supply of stablecoins is also providing the market with a good upward foundation.
This model is used for trend tracking and can provide early performance during market fluctuations or adjustments.
As time goes by, there is still a good trend at present, and it is possible that the trend will not subside in the short term.
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 • BTC exchange net position • ETH exchange net position • High-weight selling pressure • Global purchasing power status • Stablecoin exchange net position • Off-chain exchange data
Derivatives Rating: The risk factor is in the red zone. Derivatives risk is increasing.
The risk factor fell back to the red zone from the neutral zone last week, and the expected probability of short squeeze was low. Judging from the risk factor alone, there is still room for short squeeze this week.
Options trading volume has dropped significantly and the put option ratio is at a low level.
Derivatives trading volumes were at low levels.
There has been a massive increase in implied volatility.
Emotional state rating: Neutral
Last week, as the market squeezed, positive sentiment (blue line) also rose, and panic sentiment (orange line) continued to decline. At present, combined with the risk factor, the blue line needs to continue to increase in order to break through the existing price resistance range.
New and active addresses are at low levels.
Spot and selling pressure structure rating: BTC has a large amount of accumulated inflows, and ETH has accumulated outflows.
There is a large amount of inflow accumulation in the net position of BTC exchanges, and only a small amount of the current inflow chips has been digested. We need to pay attention to these potential selling pressures this week.
ETH exchange net positions are in an outflow accumulation state.
There is no high-weight selling pressure at present.
Purchasing power rating: Global purchasing power has recovered slightly, and the purchasing power of stablecoins has increased significantly.
After several weeks of loss of purchasing power, the purchasing power of the Americas, which has the highest weight this week, has turned positive, while purchasing power in Asia and Europe is still losing power.
USDC has seen a large inflow this week.
Off-chain transaction data rating: There is a willingness to buy at 64,000; there is a willingness to sell at 70,000.
There is a willingness to buy at a price around 60,000~64,000;
There is a willingness to sell at prices around 70,000.
There is a willingness to buy at a price around 60,000~64,000;
There is a willingness to sell at prices around 70,000.
There is a willingness to sell at prices around 70,000.
This week’s summary:
Summary of news:
1. Currently, we are still facing the headwind of MtGox compensation, which is expected to be paid at the end of July and early August. According to the survey, about 20% of people are willing to sell all BTC immediately.
2. After the negative news came into effect, the central banks of the United States and Europe began to prepare for monetary easing/interest rate cuts, and BTC spot ETFs from traditional markets continued to flow in, which was a good boost to BTC.
3. Pay attention to the inflation data from July to August, which will determine the probability of a rate cut in September.
On-chain long-term insights:
1. The market's ETFs are still positive in terms of net positions, and US crypto participants are still willing to buy;
2. Large positions on exchanges gradually turn to outflows, and buying intentions begin to increase;
3. Based on the 250% profit position of long-term players, the market may generate some pressure between 69,500-70,000.
• Market setting tone:
Emotions ease and willingness to buy increases.
On-chain mid-term exploration:
1. The fundamental upper and lower limits of the market are 49,000-91,000;
2. A small increase in liquidity;
3. The supply of stablecoins increases, and the short-term movement of participants is unclear;
4. It is still in a trending state.
• Market setting tone:
To ease the uncertainty of the movements of short-term participants and increase the supply of stablecoins, the recent trend performance may have a certain amplitude.
On-chain short-term observations:
1. The risk factor is in the red zone and the risk is increasing.
2. The number of newly added active addresses is relatively low.
3. Market sentiment status rating: Neutral.
4. The overall net position of the exchange shows that there is a large amount of BTC inflow accumulation and ETH outflow accumulation.
5. Global purchasing power has recovered slightly, and the purchasing power of stablecoins has increased significantly.
6. Off-chain transaction data shows that there is a willingness to buy at 64,000 and a willingness to sell at 70,000.
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:
Market purchasing power and positive sentiment have both rebounded, and there is still room for short squeeze, but we must also pay attention to potential selling pressure. In addition, there are still news impacts such as ETF and BTC conferences this week. From a short-term perspective, the market is expected to only pay attention to a small correction after the short squeeze this week.
risk warning:
The above are all market discussions and explorations and do not provide any directional opinions on investment; please be cautious about and prevent market black swan risks.
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