Market sentiment changes faster than the weather; it was just frigid, and suddenly the sun breaks through. But is this rebound a genuine market rally, or are the main players just pushing prices up to sell? Old Ma helps you peel back the surface to see the essence.
The past two weeks in the crypto world have been more thrilling than a roller coaster. The market has been in a continuous downward trend, and sentiment has dropped to freezing levels. Many began to doubt the AI narrative's stability and even thought that cryptocurrency was doomed. Once this panic spreads, it can easily trigger a chain reaction with unimaginable consequences.
Just when everyone was despairing and cutting losses, the market suddenly experienced a V-shaped reversal—Bitcoin surged from a low of $80,000 to $88,000, rising nearly 10% in just a few days.
But experienced investors like me understand that single-day fluctuations are never a signal of trend change. Today, let's talk about the truth behind this rebound and which key indicators we need to closely monitor next.
01 The rebound script directed by the Federal Reserve?
If you closely observe last week's market changes, you will find that behind this rebound, the words 'Federal Reserve' are clearly written.
Before last Thursday, several Federal Reserve officials were hawkish, and the market responded with a drop; however, Thursday evening saw a sudden change, and from Friday to the weekend, dovish signals were released, completely altering market expectations.
Federal Reserve Vice Chairman Jefferson, New York Fed President Williams, and other key figures have all expressed support for interest rate cuts. This signal directly propelled the probability of a rate cut in December on the CME and Polymarket platforms from around 20% to nearly 70%.
Even the Federal Reserve governor Cook, who was almost fired by Trump, has rarely loosened his stance; major international banks like Goldman Sachs and Barclays have also followed suit in predicting a rate cut in December, forming a short-term consensus that has become the core driving force of this market rebound.
Expectations of liquidity easing are always the best aphrodisiac for risk assets. But the question is, how long can this rebound driven by such expectations last? Can the Federal Reserve's 'verbal support' truly translate into sustained upward momentum? It is still too early to draw conclusions.
02 The hidden mystery of capital flow
Speaking of this rebound, one key data point cannot be ignored—last Friday, Bitcoin ETF welcomed a net inflow of $238 million, temporarily halting the previous continuous outflow trend.
But to be honest, a day's capital inflow does not indicate anything. What we need to observe is whether this inflow is sustainable. If funds flow out again this week, Bitcoin will likely retest the support below $80,000.
What is more concerning is that in the past few weeks, some large institutions have been reducing their holdings of crypto assets, leading to insufficient market support and prices falling into a declining cycle. Currently, Bitcoin is still below the 50-day and 200-day moving averages, and the medium-term downward trend has not fundamentally changed.
From my years of experience, a true bottom is not a V-shaped reversal, but rather a process that requires time to grind out. What the market lacks most now is confidence, not capital.
03 The game between whales and retail investors
In this rebound, there is also an interesting phenomenon—whale accounts are quietly accumulating.
On-chain analysts have detected that the '100% win rate mysterious whale' has recently added 173.6 BTC to its position. Currently, this whale holds a long position worth $338 million, with unrealized gains exceeding $17 million.
But at the same time, ordinary investors are still panic-selling. This reverse operation between whales and retail investors is worth our deep reflection.
Historical data tells us that when most retail investors feel fear and sell off their holdings, it often signals the formation of a temporary market bottom. However, this does not mean we can blindly buy the dip, as the recovery of market sentiment takes time.
The current cryptocurrency fear and greed index is 26. Although it has rebounded from previous lows, it remains in the fear zone. Historical data shows that when this index falls below 20, the market often reaches a temporary bottom.
04 Three key signals that determine the market direction
In the current market environment, where should we go? In my opinion, we need to focus on three signals next.
1. Can Bitcoin stabilize at the $90,000 mark?
From a technical perspective, Bitcoin needs to stabilize above the resistance zone of $88,000-$89,000 (upper Bollinger Band + previous dense trading area) to open up further rebound space. If it encounters resistance and falls back at this position, it is likely to test the bottom again.
2. Can altcoins keep up with the rebound rhythm?
In this rebound, altcoins have barely kept up with Bitcoin's pace, most are still in a declining state. If altcoins cannot follow, it indicates that market risk appetite has not truly improved, and the sustainability of this rebound is questionable.
3. Can the policy remain friendly?
Trump's pardoning of Binance founder Zhao Changpeng and the appointment of a crypto-friendly new chairman of the CFTC indicate that U.S. regulatory policy is shifting towards a friendly approach. If this trend can be sustained, it will provide a favorable policy environment for the market.
At this current point, I maintain a cautiously optimistic attitude towards the market. The optimism stems from the belief that the market's most pessimistic phase may have passed, while caution comes from the understanding that a true trend reversal requires time and volume accumulation.
As an experienced investor who has gone through multiple bull and bear cycles, I suggest everyone: don't let short-term fluctuations lead you by the nose, and don't lose your composure in panic. Retail investors must remain calm and wait for certainty; when the time comes to act, it must be decisive, accurate, and steady.
The market is always volatile, and within the volatility lies risk and opportunity. Only by staying rational can we seize the initiative in changing circumstances. Follow Bin Ge for more firsthand news and precise points of cryptocurrency knowledge, becoming your navigation in the crypto world; learning is your greatest wealth!#巨鲸动向 #美国非农数据超预期 $ETH
