U.S. spot Bitcoin ETF attracts $300 million in inflows
After two weeks of massive redemptions, inflows into the U.S.-listed spot Bitcoin ETF have turned positive, with Fidelity and Ark performing notably well, although global fund flows remain uneven.
Divisions within the Federal Reserve over the December rate cut are intensifying
"Federal Reserve mouthpiece" Nick Timiraos stated that divisions within the Federal Reserve regarding the December rate cut are intensifying, a level of disagreement that has rarely been seen during Chairman Powell's nearly eight-year tenure. Officials are divided on which threat is greater: inflation or a sluggish labor market, and even restoring official economic data may not bridge the gap in opinions. Although investors believe there is a high likelihood of a rate cut at the Fed's next meeting, the divisions complicate the plans.
On-chain data:
I initially thought that the price increase of BTC on Monday would drive some investors to chase highs and cut losses. However, I didn't expect that the trading volume and purchasing power of spot ETFs on Monday did not change much. Although the selling pressure has decreased somewhat, the buying volume is almost zero, which indicates that traditional investors in the cryptocurrency sector are gradually losing confidence. I mentioned a similar situation last week, and this week it feels even more pronounced. Currently, although a government shutdown in the U.S. can be anticipated, liquidity in the market is still poor, and we may have to wait until the shutdown is completely over for any improvement. Traditional investors are clearly leaning more towards U.S. stocks now, and a cooling-off period in the cryptocurrency market is unavoidable.
Continuing from the previous viewpoint, the market is currently sweeping liquidity, first sweeping away the liquidity from 107500-107000 upwards. As mentioned yesterday, if it cannot effectively hold above 107000, then it will sweep the liquidity down to 103800. The facts are evident: first up, then down; both long and short positions are wiped out. It feels like the current market is more like statistics, and the key takeaway from this recent movement is to avoid chasing highs and cutting losses. In terms of positioning, I warned everyone yesterday that the decline is not over and not to chase long positions. We placed a short position near 106500, targeting the previous 103000, which was also successfully achieved, and we reaped significant rewards.
Bitcoin's daily chart shows a long upper shadow bearish candle, and it is expected that there will be a continuation of the decline today. Yesterday closed with an engulfing large bearish candle, and the upcoming movement is relatively clear: we only need to consider whether it will be a slight rebound followed by a drop or slight fluctuations before dropping again. Rebounding shorts will definitely be the main strategy. If the decline continues for another day today, there will be fluctuations on Thursday during the day, and we will see the impact of data in the evening. If there is further negative news, the market may indeed need to go to 92000-94000, after all, the weekly chart still needs one more pin for a better rebound.
17 years of bullish to bearish transition, after a 50% rebound from a double bottom structure, it has fallen into a bearish trend, and the current movement resembles this with a 50% rebound followed by a decline, with the reversal point in the bearish trend at 1.382. If history repeats itself, the position of this decline would be near 92000, which is not far from the 94000 we have been focusing on. Additionally, there is a futures gap in this range waiting to be filled; I wonder if all of this is coincidence or manipulation.
Today's upper liquidity is in the 104400-105400 range, where 104400 has a significant gap and is also the neckline for confirming the decline. If it rebounds to this level, it would definitely be the best short opportunity, but the market may not provide this level. Therefore, in trading today, if there is a rebound close to 104000, I will directly short first, then observe the situation for potential additional positions, based on real-time updates in the group.
Ethereum 3675 resistance not breaking leads to minor level pullbacks, with a short-term key level of 3350 maintaining support today. Looking above, if the resistance of 3500 is broken, it will stop the decline and initiate a second push. If it drops below 3350, it will turn weak and pull back to 3200.
