Do you still want to get on the BTC express train with crazy acceleration?
Produced | Odaily
Author | Qin Xiaofeng
Editor | Lu Xiaoming
Produced | Odaily
Author | Qin Xiaofeng
Editor | Lu Xiaoming
According to the HOLD market, last Saturday (June 22) Bitcoin broke through the $10,000 mark.Since then, the price of BTC has skyrocketed, breaking through the resistance levels of 11,000, 12,000, and 13,000 U.S. dollars, and falling back after approaching 14,000 U.S. dollars.At present, BTC is temporarily reported at 11,600 US dollars; since the beginning of this year, BTC has increased by more than 200%, far exceeding the trend of gold in the same period (10%).Mainstream institutional funding (click to read)Impact.
It is related to admission, and some people think that it is affected by Facebook's promotion of encryption projects
Libra (click to read)
Impact.
Li Lianxuan believes that the surge in BTC is mainly due to the impact of global liquidity expectations; in addition, as a new asset, encrypted digital currency has been recognized by high-net-worth customers and institutions, and can be allocated as a new asset. Funds from these groups began to enter the market.
The following is the community Q&A session
At the same time, the two guests also gave investment advice and trading strategies. For users with risk control capabilities, they can choose high-risk financial instruments such as leverage for trading. However, it is recommended that ordinary retail investors should not play leverage, but choose fixed investment and hold cryptocurrency for a long time , to reduce the frequency of transactions.
secondary titleThe following is the community Q&A session
Q1: Bitcoin has successfully broken through the $10,000 mark, reaching a peak of $14,000. What are the reasons for this round of rise?
Li Zhe:It is mainly the improvement of fundamentals, the demand for hedging and the eyeball effect, which eventually lead to the expected improvement.
The fundamentals are mainly Facebook, Bakkt and other events; the risk aversion is mainly the Sino-US trade war, Iranian missiles, and the tense global political and economic situation; the eyeball effect includes events such as "Sun Yuchen took a picture of Buffett's lunch" and other events that attract public attention. (These events) have brought the breadth and depth of global awareness of digital currencies to a new high.
Li Lianxuan:
From a fundamental point of view, I think the main reasons supporting this round of rise are as follows:
(1) Affected by global liquidity expectations, on June 4, the chairman of the Federal Reserve hinted at a rate cut, and the market loosened expectations. Major global financial markets rose, such as U.S. stocks and gold, and Bitcoin was no exception.
(2) As a new asset, encrypted digital currency has been recognized by high-net-worth customers and institutions, and can be allocated as a new asset, so funds from these groups have begun to enter the market.
(3) Facebook is preparing to issue the stable currency Libra, so that the public has a new understanding of digital currency.I think it is mainly the above three points, especially the first point that drives this round of rise.
I think the reliability of institutional funds entering the market is relatively large. First, CME stated that 223 new trading accounts have been added to BTC futures products this year, and most of the traders on CME are institutional investors; second, it is reflected by other indicators, such as the well-known Grayscale Fund, the fundraising The targets are mainly institutions and high-net-worth individuals.
(grayscale report)
Institutional investors accounted for 73 percent of Grayscale product demand in the first quarter of 2019, compared with 66 percent in 2018, according to the fund's latest data.
image description
(grayscale report)Institutional investors accounted for 73 percent of Grayscale product demand in the first quarter of 2019, compared with 66 percent in 2018, according to the fund's latest data. We have analyzed the number of accounts with a monthly transaction amount of more than 1 million US dollars on exchanges in recent months, and found that there has been a significant increase.
Therefore, based on the above points, I think institutional funds have begun to enter the market in this round of market.
Mainly some top rich people from Wall Street and overseas. For them, the volume of BTC is not too large. In fact, large quantities cannot be bought on the market now, and at least 60-70% of the quantity comes from OTC (over-the-counter transactions).
Old BTC players, as well as miners and mine owners who hold a large amount of BTC in their hands, are actually unwilling to sell coins.
A friend of mine has established a joint venture company with Grayscale in Hong Kong, which sweeps tens of thousands to hundreds of thousands of BTC every month.
image description(99% of Grayscale’s capital inflow in the first quarter was BTC)
Q3: Is the cryptocurrency bull market coming? How does this round compare to the 2017 bull market?Li Zhe:
The bull market has always been there, but it is not yet a big bull market. The big bull market is after the BTC halving next year. So, 2020 should be more like 2017.
Li Lianxuan:
This is considered a small and medium-sized bull market, but it has not yet reached the state of a big bull market in 2017.The biggest difference between this round of market and 2017 is the source of power for the bull market. The bull market in 2017 mainly relied on the huge market demand brought about by ICO financing; the driving force of this round of bull market comes from two aspects: one is the low rebound of the cryptocurrency market at the end of the bear market before May, and the other is the entry of a large number of institutional funds in May and Fund inflows brought about by global liquidity easing expectations.
Q4: Is it still too late to enter the market and buy Bitcoin? How much room is there to continue to rise? Will Bitcoin pull back, and how much room for a pullback? What are the support and resistance levels?Li Zhe:
For BTC, which is highly volatile and has 10 times the potential in the future, the best strategy is to buy&hold (buy currency & hold currency). I don't recommend that you play short-term, fixed investment + don't increase leverage + don't get out of the car.
Li Lianxuan:
My personal opinion is that you need to be more cautious when buying bitcoins now, as the risk is relatively high. You can wait and see in July before buying. For long-term investors, the most ideal way is to invest regularly, maintain good liquidity, and invest a little every month. In the long run, Bitcoin will definitely rise.
My short-term investment decision in the Bitcoin market is based on market sentiment. The market is already relatively excited, and it is not appropriate to buy in the short term.
I remember that when it first reached $13,000 that day, I advised some friends not to buy. As a result, after a few hours, Bitcoin fell to the current position of $11,000. Therefore, it is better to be cautious when the market is more excited.At present, from the K-line chart of Bitcoin, the support level is around $11,000, and the resistance level is around $14,000. However, the current market volatility is relatively large, and the support level may be broken
Q5: We have also seen that Bitcoin has almost returned to the level of the bull market in December 2017, but there is still a certain gap between other mainstream currencies (ETH, BCH, etc.) and the bull market. Why did the mainstream currency increase not keep up with Bitcoin?Li Zhe:
Because local tyrants only buy BTC. The fundamentals of other coins, except for ETH, are not hard enough, and ETH should continue to be observed.
Li Lianxuan:
As I just said, the current round of Bitcoin’s rise is largely due to the entry of institutional funds. At present, institutional investors (such as Grayscale Fund) have a relatively high degree of recognition for Bitcoin, and relatively low recognition for other mainstream currencies. , so the increase of other mainstream currencies is also smaller than that of Bitcoin.Among them, the Bitcoin trust fund has a scale of 1.97 billion US dollars, while the funds of other currencies such as ETH, BCH, and XRP are probably in the tens of millions of dollars.
Q6: According to the performance of the last round of bull market, Bitcoin rose, and altcoins should rise even more. Why did this round of rise not drive other altcoins to rise, and some altcoins even fell instead of rising?Li Zhe:
The answer to this question is the same as the fifth question, that is, local tyrants and institutions only buy BTC. The bargaining chip structure is determined, and Xiaobi has not risen this round. First, the fundamentals of small coins are not solid, and second, the market is too small for large funds to participate.
Li Lianxuan:Because the main driving force of the last round of bull market came from ICO, many new currencies became popular because of ICO, or the two achieved each other. At that time, many investors had just entered this market and didn’t know much about it. They listened to the propaganda of some project parties. Just invest blindly; the main driving force of this round of bull market is institutional funds, and investors have become more mature after one or two years of education. Many altcoins are not recognized by investors, so naturally they cannot rise.
Q7: At present, many exchanges are still issuing new coins. Is it worth starting and why?Li Zhe:
The new logic of the exchange is to cut the listing fee of the project side and let the project side make market pull. But most project parties have no money of their own. If the project party itself has no traffic, or cannot attract new leeks, it basically has to be pulled down after being pulled up. I basically don't participate.
Li Lianxuan:
In every round of bull market, exchanges will list new coins while it is hot, but from the current observations, the new coins are smashed shortly after listing. This is a "stupid game", running faster than anyone else, betting on who will be the last Taker, I think that for investors, they can snap up new coins in the primary market and then sell them quickly; buying in the secondary market is unnecessary.Of course, for some projects with a strong team background, strong capital and technical strength, I think that after the new currency has fallen for a period of time, you can try to buy some after it falls to a certain level.
Q8: Many people who are short-lived choose to add leveraged trading. What do the two guests think of leveraged trading? How to make good use of leveraged trading, can you give some practical strategies?
Li Lianxuan:
Personally, I am not in favor of leveraged trading, but leveraged trading is indeed very attractive. As long as the general trend is grasped correctly, higher returns can be obtained through leveraged trading.
In the matter of making good use of leveraged trading, I think the most important thing is to control the risk well. Because when investors conduct spot transactions, even if the price falls, investors still have residual value, and as long as there is enough time, the price may rise. But for futures trading, once the leverage is too high and the trend is not accurately grasped, the position will be directly liquidated and there will be no income.
When you are trading futures, it is easy to be confused by complex calculation formulas such as margin rate and profit and loss surplus, but these formulas are very important. My suggestion is that you calculate the break-even point. For example, this is what I did:
After calculating the break-even point of the strategy done in the research process, we can get a risk control line:
Just like the picture above, it is the relationship between leverage and market volatility risk under a margin rate of 0.05%. Then we can look back at the market fluctuations in the past month or months to find the optimal leverage position. For example, the current daily fluctuation range of Bitcoin is about 16%. We draw a line along the position of y=16%, and the position where it intersects with the risk control line is the optimal leverage position. Of course, I suggest that the actual leverage should be lower than the optimal leverage.In terms of direction determination, due to the existence of the liquidation mechanism in the futures market, it is necessary to judge the short-term trend. At this time, I suggest comprehensive basic analysis and technical analysis to judge the market. Backtracking data is not a simple backtracking, it is backtracking using statistical methods, such as the average daily rise and fall in the past six months, all the data can be collected to make a rise and fall distribution map, and then calculate the probability, the picture below is Bitcoin in recent years The income distribution chart of :
Trend judgment + leverage control, there will be very few liquidation situations, this is my strategy.
Li Zhe:I am engaged in quantification myself, from traditional stocks and commodities to the current digital currency. My suggestion is that retail investors should not play with leverage. The mentality of a gambler must end up with nothing.
Q10: Bitcoin will be halved in May 2020. Will the halving market bring a new round of rise? What is the logic of the rise? When is the market likely to be?Li Zhe:
Yes, halving is a strong positive. Then Facebook's Libra will be released in the first half of next year, depending on how much it can bring to the 2.7 billion users on its platform. At present, there are about 25 million users in the currency circle. Improvements in other fundamentals, one is the pos track, dapp is currently a bit cold, and defi is rarely used by ordinary users except for large households. Therefore, new bright spots need to be continuously observed.
Li Lianxuan:
Judging from the previous two production cuts of Bitcoin, it is true that the price of Bitcoin will rise. From the perspective of supply and demand, the halving of Bitcoin production slows down the increase in supply, resulting in an increase in the price of Bitcoin. The entire impact process is as follows:My personal opinion is that there is no need to consider the market, but that I have enough bargaining chips before the market, so long-term fixed investment is still a better strategy.
Q11: What is the income of the two bosses in this round of market, what is your investment strategy, can you share it?
Li Lianxuan:I probably bought at $4,500 and sold at around $12,000. Since the principal was relatively small, I didn't make much money.
