$BTC dropped from 126,000 to 89,000, the fear index fell to 23, who will win in the long and short?
Currently, Bitcoin is actually locked in a "pulling mode" by the macro environment. The reasons for the bears are very sufficient: the Bank of Japan raised interest rates to 0.75%, which hasn't happened in nearly 30 years; when the yen tightens, Bitcoin tends to drop; coupled with the fact that U.S. Treasury yields have not come down, global funds are being drained, and the coin price was once smashed below 84,000.
However, the bulls have not given up. The Federal Reserve has stopped shrinking the balance sheet, initially injecting $13.5 billion, and may eventually inject a total of $40 billion; institutions are also starting to slowly enter the market, Vanguard has launched a crypto ETF, and Bank of America allows clients to allocate up to 4% of Bitcoin. In the options market, there are people ambushing rebounds at 100,000-115,000, while spot funds are desperately buying at 80,000-85,000.
What’s noteworthy is that the cost for new buyers is lower than that for old buyers. Normally, the cost for new entrants should be higher, averaging $2,500 more expensive, but this time it’s completely reversed. Historically, this situation has occurred only 9 times, each lasting an average of 145 days, with significant price fluctuations; the maximum cost difference has even widened to -19,500. But this is not necessarily a bear market signal; it resembles the market "changing hands and washing plates," with chips flowing from those who can't hold on to those who have lower costs and more patience. Mid-term holders have not collectively cut their losses. The market appears to be fluctuating, but its internal structure is quietly stabilizing.
Leverage in the derivatives market is retreating. The Z-value calculated from open interest and funding rates has dropped to -0.28, indicating that people are no longer aggressively increasing leverage as they used to. In the past, when the Z-value turned positive, the market relied on leverage to push prices up rapidly, but also to drop just as fast; now, leverage is slowly exiting, and risks have been partially digested. The key is that all of this is happening around $90,000, suggesting that the pullback is not being driven by liquidation but rather that the market is actively hitting the brakes.
Therefore, my view is that while the market seems to be in panic, it is actually silently "cultivating internal strength." The long and short are still in a tug-of-war, but the exit of leverage, the lowering of costs, and institutions quietly laying out strategies all indicate that this may not be the end, but rather a preparation for the next wave of the market. It's hard to say who will win or lose in the short term, but the mid-term structure is actually improving, so don’t be scared off by superficial ups and downs.
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