Yihai Lunbi writes each analysis article with a responsible, focused, and sincere attitude, characterized by distinct features, without pretentiousness or exaggeration!
Daily market interpretation, I am cryptocurrency analyst Yihai Lunbi!
BTC surged from $84,500 to $87,500 yesterday morning, and later in the evening saw further increases, testing the MA200 again in a spike form. However, the performance of U.S. stocks was not good yesterday, with all three major indices closing in the red, and BTC fell back to $86,400, currently rebounding to $88,500. However, it must be said that this wave of BTC's rise yesterday also saw a significant increase in open contracts, indicating that market attention is rising. On the other hand, this rise seems somewhat unsustainable, but the cryptocurrency platforms in the U.S. have recently seen a significant positive premium. Some friends may say that Old Yi's predictions are quite accurate, but from my perspective, some market trends are foreseeable from a trend standpoint, not predictions. Everyone can recall that Old Yi reminded everyone there would be a relatively positive trend since last week. From the battle situation, considerable returns have also been achieved. Although I didn’t capture yesterday’s further rise, the short positions from the spike and drop were once again securely taken in. The continuous washout by big players, the obvious trend, and the assessment of risk avoidance make it hard to miss opportunities for steady progress in this market. Friends who have joined this wave have also perfectly concluded their trades, although some new friends chose to retreat halfway, the overall returns are still quite good.
Yesterday, BTC spot ETF saw a significant inflow of $381 million, indicating that American investors, especially institutional investors, have seen a resurgence in demand. Although this wave of increase was driven by leverage, it is also accompanied by rising spot demand. From the chip distribution chart, the chip column at $84,500 has surged very high, or it can be said that the area between $81,300 and $84,500 is forming a stronger support. This means that many active chips have accumulated here over the past week. Previously, the chip column at $97,000 was the highest, and it seems that the chips stuck at high levels are loosening up and being bought at lower prices. Especially, the chip column at $84,500 has shown significant growth recently, even surpassing the area between $81,300 and $83,500. Over the past week, BTC has been trading above $83,000. If BTC's price slightly dips, most of the newly bought funds will quickly enter a state of floating loss, which can also test the strength of the support in this area. However, so far, we haven't seen this situation occur. In fact, if we exclude the turbulent moments around the tariff implementation, BTC has consolidated in an important support area for a long time. Clearly, BTC needs to reclaim the MA200 to see a more positive trend. The current MA200 is at $88,366.
The article is not over yet, and BTC has already broken through $88,000. The related Mayer multiple indicator, the 200-day moving average's 2.4 times high valuation line, has already surpassed $210,000. However, during this bull market cycle, it has not touched the red high valuation line. The fundamental reason lies in the expansion momentum of macro liquidity, which is far less than the previous two cycles. In the past cycles, it was in a low-interest-rate environment, and capital introduced some liquidity into the crypto market in pursuit of returns. Since the Federal Reserve's interest rate hikes began in 2022, BTC has faced a high interest rate level of over 5% for the first time since its inception, accompanied by both short-term and long-term Treasury yields rising to relatively high historical levels. This provides a high-risk-free return option for a large amount of capital. Theoretically, the attractiveness of risk assets will sharply decline. This cycle has been quite tortuous. Even so, BTC has still met many investors' expected targets, seeing levels above $100,000 and even $110,000. This is indeed also linked to the listing of spot ETFs, attracting more institutional investors. Currently, the 1.5 times value of the BTC 200-day moving average, which is the yellow line part, has also exceeded $130,000. If we can reach some degree of reconciliation in the trade war with the U.S., combined with the trend of global monetary expansion, BTC could also smoothly return to $100,000 in the next few months. At the same time, M2 money supply has reached a new high, and Old Yi's view on the bull market remains unchanged.
Although BTC has been consolidating, it has long since bid farewell to the downward trend line. Given the frequent turnover of a large number of chips in the range of $81,300 to $84,500, a more solid support area has formed, and even the growth speed of the chip column at $86,700 is very fast. In the short term, the 4-hour RSI seems a bit overheated, and we need to be vigilant about the possibility of price correction. Since the decline in early February, BTC has always been rejected at the 4-hour MA200. However, after breaking through on April 12, BTC has maintained above the MA200 and has seen more upward movement after a period of consolidation. If the 200-day moving average can be effectively broken next, it would be an ideal situation. Currently, the main sellers of BTC are short-term holders who are stuck. Every dip in BTC's price leads to panic selling from this group, resulting in more chips flowing back into the hands of long-term players, indicating that the washout process is nearing its end. The chips in the hands of short-term funds that choose to realize losses have nearly finished, and BTC will complete the bottoming process. This premise is that the bull market structure has not been broken, and BTC's price can recover quickly afterward; otherwise, if it enters a bear market, it will be another story. Moreover, the expansion of macro money supply, including the continuous decline of the dollar, creates favorable conditions for risk assets. There are also expectations for interest rate cuts in the second half of the year. Therefore, while many people are shouting bear market, Old Yi remains optimistic. As for the short-term aspect, the washout by the big players will not stop, and risks still exist, with the trend remaining the main theme. Continue to look for aggressive opportunities at low levels, and friends with ideas remember to communicate with Old Yi in advance to plan their positions!
Yihai Lunbi: The success of investment depends not only on choosing good targets but also on when to buy and sell. Protecting the principal and properly allocating assets is the key to steadily advancing in the ocean of investment. Life in the world is like a long river flowing into the sea; what determines victory or defeat is never the gains and losses of a single checkpoint or the profits and losses of a particular moment, but the vast convergence of many rivers!
This article is just a personal opinion and does not constitute any trading advice. The cryptocurrency market has risks, and investment should be cautious!
