The rekindled hope has been extinguished again - after a brief recovery in the crypto market, it has once again plunged. Investors who were still hoping for a 'V-shaped reversal' yesterday must now face reality: the oversold rebound was just a 'flash in the pan'. The upcoming period of volatility and correction will be the true test of patience and strategy. Although Bitcoin is still struggling at the $110,000 mark, the scars left by the $20 billion liquidation, the gradually cooling market sentiment, and the doubts about whether the 'bull market has ended' make this round of fluctuations full of uncertainty. To survive in this market and even seize opportunities, one must first clarify three core questions: How stable is the support at $110,000? What strategy should be used during the volatile period? Which pitfalls must absolutely be avoided?
1. $110,000 is not a 'safety cushion', it is a 'bull-bear killing line'
Many people consider Bitcoin holding above $110,000 as a signal that 'the bull market is not dead', but a closer analysis reveals that this position is more like a 'temporary battlefield' between bulls and bears, rather than an absolutely safe support level. The three underlying concerns determine that the consolidation period will not be calm:
1. The aftermath of the $20 billion liquidation: capital confidence needs 'long-term repair'
During this plunge, the total liquidation amount across the network exceeded $20 billion in 24 hours, setting a new high since 2025. After a large amount of leveraged capital was cleared, the market needs time to re-gather buying pressure—after past similar scale liquidations, Bitcoin typically takes an average of 45 days to restore previous liquidity, during which there will be repeated 'slight rebounds → low-volume pullbacks' in the consolidation trend. It's been less than a week, and market confidence has yet to recover; the support at $110,000 is more of a 'short-term emotional support' rather than 'fundamental consensus support'; if new negative news appears (for example, rising expectations of Fed interest rate hikes, tightening regulatory policies), there is a high chance of another drop.
2. Controversy over the end of the bull market: the key is to see 'where to go after consolidation'
Currently, the biggest divergence in the market is whether 'this round of bull market has already ended'. Those supporting the 'continuation of the bull market' believe that the trend of Bitcoin rising from $80,000 to $115,000 has not been broken, and that $110,000 is a normal correction; however, opponents point out that the scale of the $20 billion liquidation is close to the liquidation level at the peak of the 2021 bull market, and that altcoins have generally fallen below the 200-day moving average, which is a typical signal of 'the end of the bull market'.
In fact, the key to judgment is not 'is it a bull market now', but 'which direction to choose after consolidation': if Bitcoin can consolidate in the $110,000 - $112,000 range for more than two weeks, and there is a volume increase during this period (for example, a single-day trading volume breaking $50 billion), it indicates that buying pressure is gathering, and there is a possibility of extending the bull market; conversely, if it breaks below $108,000 after consolidation (the lower edge of the previous consolidation platform), it is likely to enter a mid-term adjustment, and the bull market will temporarily come to an end.
3. Accelerated cooling of sentiment: the 'extinguishing' of the new market serves as a warning
The changes in market sentiment are more real than K-lines. In the past few weeks, the enthusiasm in the crypto new market (such as Launchpad and IDO projects) has continued to decline; the latest project launched on a leading platform has seen participation drop by 60% compared to its peak period, and the winning rate has surged from 15% to 45%—this indicates that retail investors' 'willingness to take risks' is fading, as people shift from 'chasing highs' to 'waiting'. The new market has always been a 'barometer' of sentiment; when it cools down, the entire market's activity will further decline; even if Bitcoin holds above $110,000, it is unlikely to experience a significant rebound, but rather more of a 'sideways grinding' trend.
2. Three operational key points during the consolidation period: prioritize grid trading, be cautious with altcoins
In the face of a 'grueling' consolidation market, blindly bottom-fishing or staying on the sidelines are not good choices. Considering the current market characteristics, these three operational key points can help you balance risk and return:
1. Core strategy: use grid trading to 'capture the price differences during consolidation', avoiding emotional trading
The most suitable strategy during a consolidation period is 'grid trading'—setting multiple buy and sell levels in the Bitcoin range of $108,000 - $115,000, for example, buying every time it drops by $500 and selling every time it rises by $500; for Ethereum, set the grid in the $4,000 - $4,300 range. The advantage of this strategy is that 'you don’t have to guess the direction'; no matter how the price fluctuates, you can earn the difference by buying low and selling high, and avoid emotional trading caused by 'greed during a big rise' or 'panic during a big drop.'
It is important to note that the position for grid trading should be controlled at 30%-40% of total funds, with the remaining funds reserved for 'emergency replenishment'—if Bitcoin suddenly drops below $108,000, the grid trading may incur short-term losses, at which point using reserve funds for replenishment can lower the average cost and wait for a rebound to break even.
2. Target selection: only focus on 'large coins with resistance to declines', avoid altcoins entirely
The principle of selecting targets during the consolidation period is only one: 'priority for resistance to declines'. Bitcoin, Ethereum, BNB, and SOL are the top choices, and their common characteristics are: large market capitalization (all above $100 billion), high institutional holding ratios (for example, Bitcoin's institutional holding exceeds 35%), and ecological support (Ethereum's DeFi TVL is $86 billion, BNB Chain's daily active users are 2.52 million).
Especially for Ethereum, during this plunge, the drop was only 4%, far below the average decline of altcoins (15%-20%), and it quickly rebounded from $3,900 to $4,100, showing strong resistance to falling and elasticity, making it suitable as a core target for grid trading.
As for altcoins, even those with 'market caps of tens of millions that have been listed on Binance spot', should definitely not be touched. After this plunge, the liquidity of altcoins has clearly decreased, many coins seem to have 'dropped to a level', but in fact, they are in 'sideways trading with no buyers'; once market sentiment cools further, there is a high risk of 'volume-less declines', making it very difficult to break even after being stuck. In past rounds of consolidation, the average drop of altcoins was 10%-15% more than large coins, entering the market now is purely 'picking up crumbs from the fire'.
3. Position adjustment: cut leverage, keep cash, and maintain respect for black swans
After experiencing the $20 billion liquidation, regardless of whether you have incurred losses this time, you must make position adjustments:
Completely cut off leverage: clear all leveraged tools like perpetual contracts and options; during the consolidation period, the direction of bulls and bears is difficult to determine, and leverage can easily lead to 'back-and-forth harvesting'; among the investors liquidated this time, 80% used more than 5x leverage;
Keep 30% cash: do not invest all funds in grid trading or spot trading; keep 30% cash for extreme situations—if Bitcoin suddenly drops below $100,000, cash will be the 'bullets for bottom-fishing';
Diversify holdings: diversify among large coins as well; for example, Bitcoin accounts for 20%, Ethereum for 15%, and BNB and SOL each account for 5%, avoiding risks from fluctuations in a single coin.
Remember, the black swans in the crypto circle are always more numerous than you think—such as the LUNA crash in 2021, the FTX explosion in 2022, and this $20 billion liquidation in 2025, each of which has caused those who did not do proper risk control to lose everything. Respecting the market is not just an empty phrase; it is the premise for 'surviving' through positions and strategies.
3. Two key signals: focus on these two points to judge when the consolidation will end
The consolidation period will not last forever; when these two signals appear, the market is likely to choose a direction, which needs to be closely monitored:
1. Trading volume: only a breakout above $115,000 or a drop below $108,000 indicates the true direction
The core feature of the consolidation period is 'low volume'—if Bitcoin's daily trading volume remains below $30 billion, it indicates that both bulls and bears are waiting, and the market will continue to move sideways; once the trading volume suddenly increases (for example, breaking through $40 billion), and the price breaks above $115,000, it indicates that buying pressure is starting to build, the consolidation will end, and a new round of increases may begin; conversely, if the volume drops below $108,000, it is likely to enter a mid-term adjustment, requiring timely stop-loss.
2. New market enthusiasm: only when it heats up again does the sentiment truly recover
As mentioned earlier, the new market is the 'barometer' of sentiment. When the number of participants in a new project on a leading platform rises to over 70% of its peak period, and the winning rate drops below 20%, it indicates that retail investors' willingness to take risks is recovering, and the market sentiment is shifting from 'waiting' to 'active', which suggests that the consolidation period may be nearing its end. Conversely, if the new market continues to cool down, even to the point of having 'no subscriptions for projects', it indicates that sentiment is still deteriorating, and the consolidation period will be prolonged.#巨鲸动向
