Here is my personal analysis and understanding of the market:

1. This week, many domestic and overseas KOLs and metaphysics bloggers on Twitter are discussing the trend of $BTC from late May to early June 2022 — that is, 74000 is the rebound top, and in the next few days, it will create a daily LH and then continue to initiate a large-scale decline. This has almost become the publicly recognized 'cognitive trend' across the internet.

I personally started shorting comprehensively from late October at $BTC 116000, when the market was still at the bull-bear boundary, and many people were firmly believing that the bull market had not ended, resulting in significant market divergence. That was the first battle between the first batch of short sellers and the strong bulls.

The drop from 120,000 to 80,000 is a delicious fish head that only a few air forces can enjoy; then the second wave drop from 100,000 to 60,000 is for traders who can timely correct their views and follow the market trend to enjoy the fish body.

However, the current bear market's three-wave drop, which everyone can understand, has already become an overcrowded 'tail' event.

According to the market's 'reflexivity principle', this well-known tail event of short liquidity is not that easy to take advantage of.

2. Technical aspect: $BTC and $ETH have formed a golden cross in the daily EMA7 and EMA25, and the 4-hour moving averages are fully bullish diverging. This morning, while watching for a breakout, the 4-hour structural chart I was looking at was actually quite simple:

BTC first broke through the lower yellow triangle, then retested the upper edge and held steady, which indicates a strong bullish trend. Afterward, the market oscillated within a small triangle above, compressing to the extreme, and officially completed the breakout this morning.

In the past two days, the CVD and OI of BTC have also continued to rise significantly, clearly showing no signs of major players exiting the market.

Secondly, in terms of MACD, the 3-day line has officially formed a golden cross, and the momentum bars of the 3-day line are still in the initial growth stage. From the perspective of the 3-day line, the market is likely to continue for a while.

3. From the perspective of the K-line alone: from my personal view, if the market really wants to replicate the LH pattern from early June 2022, quickly inducing longs before a dump, then the K-line should not follow the current trend.

The most effective way to accumulate short liquidity is not through violent increases; that will only cause most shorts to quickly stop out and exit.

Only the current situation of moving three steps forward and two steps back, slowly rising and rising in shadows, is the most extreme way to induce shorts.

Those who short here generally have two types of mindsets and methods:

The first type: On March 11, I opened a short near $BTC 70,000 for the daily LH. This morning, after seeing a breakout above 72,000, I chose to rationally stop out.

The second type: After opening a short on March 11, this morning, upon seeing a breakout, I chose not to stop out and continued to hold the position and add to it. Because I thought to myself: 'After all, it’s a bear market rebound; how high can it rebound?'

If the market continues to follow this pattern of moving three steps forward and two steps back, with small increments, this morning, the first type of air forces who rationally stopped out before BTC broke the previous high will likely see a small-level false break and quickly reopen their short positions. When they think this time it should be a smooth setup, BTC will make a new high again.

Then the patience of the first type of rational stop-loss air forces will also be continuously consumed due to repeated stop losses, until they finally fall into the second type of crowd: 'To hell with it, I simply won’t stop out; how high can it go?', and then they also start to choose - to hold the position and add to it.

Thus, the short liquidity accumulated above will continue to increase.

The increase from 70,000 to 79,000 has nearly 13 points; for BTC, 5-10 times shorting is the norm. Even in this process, even if the initial position is not highly leveraged, the air forces will gradually increase their leverage through continued holding and adding to their positions until they also approach the critical point.

——————The above is for reference.