°Reasons for the bearish trend.
1: (Technical Pattern) Last week's 68500/70000 resistance level warned of the risk of a pullback because this is a double resistance level structure on the daily chart. There are many loss-making positions gathered above it, and selling pressure is strong. Since the Rebound on July 5th, trading volume has significantly decreased and the pattern has become stagnant. Therefore, it is difficult to break through this level at once. BTC must go through a pullback (three waves or five waves) in terms of structural pattern and then build up momentum to break through the resistance zone.
2: (Fundamental) Many people believe that last night's data was perfect and exceeded expectations. Why did the US stock and encryption markets experience a big dump after the interest rate cut? This is because the interest rate cut in September has been speculated for several months, and the current result is already a foregone conclusion. Yesterday, the unemployment rate hit its highest value since 2021 and the Sam index (recession signal), causing the market to trade with a logic of avoiding suspicion. The panic spread to the global financial market, as last night's data represents a long-term favorable information, indicating a recession in the US economy, which means accelerating the pace of US point shaving. Short-term unfavorable information is all due to emotional factors. For the macro economy, what's more important for BTC is the halving cycle, liquidity, and on-chain data. There is no need to worry too much about the existence of a bull market.
°What now?
The weekly and monthly trends still show no change in the rise. As indicated by the short-term trend, BTC has now followed the retracement pattern of the five waves of the four-hour structure as scheduled, and is currently operating in the fifth wave. The reversal point of this retracement for BTC is around 64500-65000 (near the yellow falling trend line). If BTC breaks through and stabilizes above this level in the future, the market will confirm a phase bottom and initiate a new upward trend. Due to the low volume in the market on weekends, there will not be significant movements, and the focus will be on bottom oscillations. It is important to follow the situation of the Market Maker next week. In the short term, following the 62300 resistance level in the evening will suffice; if the breakthrough is maintained, the bulls will continue the Rebound action in the range of 63000-63500. Otherwise, it will continue to oscillate and consolidate. Often, the initial phase of a retracement starts with the altcoins falling first, and finally, BTC does not fall but the altcoins follow suit. This is a sign of the end of the adjustment phase. There are currently two trend scenarios being played out.
1: BTC Rebound is strong, and the market will break through the resistance level of 64500-65000 and start a new round of pump.
2: BTCRebound does not break the resistance level, and the market will retest it twice in the future. After Long Wick Candle quickly pulls back from the 59000-59800 area, it will then start to pump.
Regardless of the trend, the market remains bullish. Currently, all the unfavourable information has been released, and the market will be driven by favourable information such as interest rate cuts, elections, and FTX compensation, entering the second phase of the bull market. This is a greater opportunity than risk. The expected pullback has arrived, so let's accept it and make strategic arrangements, staying away from noise.
°Spot Strategy
At the 70,000 prompt to reduce position and swing trading of Position, we have already completed the operation of increase the position yesterday morning and evening. The current increase the position also has floating profits this morning. Currently, the SpotPosition that is in sync is around 80-90%, and the remaining 10%-20% Position should not be moved for defensive purposes. In case the market breaks the Long Wick Candle and liquidates the contract below 60,000 for a second time, we will fully enter the market again. If the Long Wick Candle does not occur, we can wait for a pullback after breaking the trend line and then engage in short-term swing trading. Those who have already completed the layout of ETH can hold it. Those who have a position with a cost around 3,000-3,100 can consider fully entering the market when there is a second bottoming at 2,800-2,900.
