Bitcoin market analysis: in a bull market but don't know it?
Bitcoin went out of a V-shaped reversal on the weekend, and the general election has come to an end. The weekend market has staged a roller coaster. It made a thousand-point correction on Saturday, and it rose back on Sunday. To $15,650, it is still volatile in essence, just a deep V trend, and the positions of hundreds of millions of dollars in the market are gone. Even though there is a thousand-point correction on Saturday, if the trend has not changed, there are still investors who catch the pullback and sell short, just like there are still investors who go in directly to chase long when there is a callback signal on Friday. Even in a bull market, the question of whether you can make money is still on yourself.
Cryptocurrency data analysis company CoinGecko recently released a cryptocurrency market report. The report shows that in October, the only encrypted asset with an increase in market share was Bitcoin, while the market share of other mainstream cryptocurrencies did not increase. The market share of altcoins is declining, basically in line with investors' impression of the market.
Among them, the total market value of Bitcoin increased by 4.5%, exceeding 2 billion US dollars, while the market value of ETH, BNB, and XRP and other currencies are all declining, including USDT, which has been issuing additional issuances in the past, also declined in October.
According to the report, this may be a sign that the cycle of altcoins is slowing down and investors prefer Bitcoin.
Regarding this point, our thinking may be a little more extreme. At present, perhaps only domestic retail investors are in love with altcoins, and the institutions that triggered the Bitcoin bull market have no ideas about altcoins, nor have they put them into action.
This can be seen from another data. The report shows that the trading volume of the top seven centralized exchanges and decentralized exchanges in October shrank by US$90.5 billion, of which the trading volume of centralized exchanges fell by as much as 34%. , the decentralized exchange also saw a 32% drop. The trading volume of Binance and currencies, which are dominated by domestic users, has fallen by as much as 78%. As for OKEX, due to special reasons, there is basically no data.
The top seven centralized exchanges include top foreign exchanges such as Coinbase, Bitfinex, and Gate.io, as well as exchanges that are familiar to domestic investors such as Binance and Huobi. This data can better illustrate our judgment.
Exchanges such as Binance, Huobi, and Kucoin have two characteristics. One is mainly domestic users, and the other is mainly altcoins and contract transactions. However, the trading volume of exchanges with these two characteristics has dropped sharply, indicating that 10 Domestic investors did not participate much in the bitcoin-based transactions in the month, and did not even respond to them. Most of them just stared at or held altcoins that did not fluctuate, reducing the transaction volume.
In addition, due to the event that OKEX stopped withdrawing coins in October, it also had a greater impact on the other two major domestic exchanges, so it is normal to reduce the trading volume.
While the trading volume of Binance and Huobi fell by 78%, the trading volume of the top 7 exchanges fell by 32%, indicating that the trading volume of some foreign exchanges is rising, and the trading volume of Binance and Huobi fell The neutralization figure of 32% is only achieved when the trading volume increases, but the rising trading volume cannot completely cover up the declining trading volume of domestic exchanges.
At the same time, it also shows that the channels for buying Bitcoin in October are mainly through foreign exchanges, mainly foreign investors.
In this way, it is back to the reality of the current altcoin investment. In this wave of rising bitcoin prices, there is no incremental capital in the domestic currency circle at all.
Looking back at the great bull market in 2017, Bitcoin and Ethereum have risen so sharply, which has attracted inflows of funds from outside the circle, and the funds from outside the circle not only flowed into currencies such as Bitcoin and ETH, but also gave birth to the bull market of altcoins.
In the current situation, Bitcoin is being pushed up by funds, mainly foreign institutional funds, while domestic retail funds mainly do not respond to altcoins, and only the original funds in the currency circle hold altcoin bargaining chips , I also look forward to the altcoins can follow the example of 2017, and after the stagflation of Bitcoin, funds can come to the altcoins.
It cannot be said that there is no chance at all, but this opportunity is likely to be a trap. For example, the banker in the altcoin currency deliberately pulls up the market when Bitcoin is stagnant, creating the illusion that the altcoin is rising. As a result, the market will also There is a voice that it is the turn of the altcoin to show off, and then attract chips, but the key is how long can the attracted funds last? Even how much money can be attracted is also a question. The most likely result is that after attracting a batch of funds, it will be silent again.
Before things happen, it is difficult to judge such a situation, so before investing in altcoins, you still need to weigh the risks more. Whether the previous ambush and waiting for the outbreak is really useful, the basis for judging is the enthusiasm of the current market for altcoins? In addition to foreign institutional funds that do not favor altcoins, are there other channels for funds to flow in?
Going back to the market, after the opening of the day, it is still dominated by a small step back. The current approximate fluctuation range is 15,200-15,600 US dollars. From the perspective of form, even if most of the gains were recovered the day before yesterday, it has not yet caught up with the trend today. rise.
In terms of weekly form, last year’s rise was about the same as this year’s rise, but last year it continued until the beginning of July and began to enter a callback without turning back. This year looks obviously different. This year’s rise looks healthier. After a period of rising , began to pull back to digest the gains, and then continued to rise.
Perhaps it is because of the different rising factors, there is still a difference between retail participation and institutional participation. The market for retail participation is essentially induced by market makers. Once the price reaches a certain height, retail investors will fall like a mountain when market makers withdraw, while institutions It is difficult for investment to have such a situation, and most of the stable income is the mainstay.
And this year's rise seems to be slower than usual. This is also an approach that does not pursue short-term gains. Slow but steady is the characteristic of the bull market triggered by this institution, and it is currently close to the weekly line of five consecutive positives. It is also a callback to digest Normal, although the callback has not yet started, but according to the previous rhythm, the higher the position, the greater the probability of a callback, so it can be prepared at the weekly level.
At the daily level, every time the market rose slowly in the early stage and then suddenly accelerated, there is one thing in common, that is, the market slowed down and began to enter a relatively volatile structure. It is rare for the market to continue to rise immediately. It also makes sense.
However, we still need to pay attention to today’s market. Generally, the market is too much looking forward to the fiscal stimulus policy after the dust of the general election. During the day, the U.S. index futures performed relatively strongly during the day. The currency still has a greater chance to follow the changes, and the probability of rushing upwards is also relatively high.
