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After a long integration, Bitcoin failed to maintain the previously established support level of more than US$11,000, and has now fallen into the US$10,000 price range. Today’s price plunge marks the first time Bitcoin has been subject to downward pressure, and may make it even harder to break through the annual high of $13,800.
According to the HOLD market, at 8:00 this morning, the BTC prices of the three major exchanges fell below the $10,000 mark. As of press time, Huobi temporary report 10142 USDT, OKEx temporary report 10147 USDT, Binance temporary report 10139 USDT.
The total market value of cryptocurrencies has shrunk by more than US$20 billion in the past 24 hours, and is currently only US$273 billion. Over the past week, BTC has continued to fall after a short-term breakthrough of $13,000, down 12%.
This decline can be traced back to July 9th. That night, a large-scale Bitcoin sell order appeared on Binance, and nearly 7,000 BTC were sold in a concentrated manner, which directly led to a decline of about US$400 in the price of BTC.
In the view of Yu Bolun, a big V of TradingView, a professional investment community, as the positive news is realized, profits increase, and the main force is not in the mood to stand guard at a high level and choose to ship, so the market plummeted.
Coindesk analysis also pointed out that this market decline is mainly due to the lack of existing funds in the market by early profiters cashing out and leaving the market; in addition, only if there is a "large volume increase" (that is, the rising trading volume exceeds the previous decline in trading volume), the market can recover.
Binance Research believes that Bitcoin’s callback so far can be considered “healthy.” The reason is that in the past bull market, Bitcoin has been pulling back 20~40% within one month (currently less than 30% from a high point), which is determined by Bitcoin's inherent characteristics (inelastic supply, difficulty in valuing intrinsic value). However, statistics prove that the advantage of Bitcoin is that the risk-adjusted return ratio is the highest among all major assets, which means that a certain degree of decline often corresponds to a larger rise in the future.
Secondly, from the perspective of the macro environment, Bitcoin's accelerated decline began after the Federal Reserve's interest rate meeting last week (July 10). Statistics show that Bitcoin's short-term short-term is insensitive to most economic data/policy changes, but relatively speaking, Bitcoin's response to inflation/interest rate data or policy events is relatively strong.
OKEx Chief Analyst K Ye also said that the main reason for this round of decline is basically in line with the results of previous analysis and is a reasonable pullback. According to OKEx BTC's quarterly contract quotation, BTC's rise from around US$7,000 has not experienced a correction of more than 30%. If a bull market wants to grow healthily and have a long continuous cycle, it will inevitably undergo multiple pullbacks and corrections in the middle.
OKEx Investment Analysis Department shared data
fluctuated the market, long and shorts were in a stalemate
Before the market began to fall, BTC had been fluctuating in the range of US$10,000 to US$13,000. Many analysts said that the fluctuation market meant that both the bulls and shorts were in a stalemate and the market was choosing its direction.
coins circle gold nuggets analyzed that on the one hand, after the previous rise and then plunge, the strength of the bulls and bears has completed several rounds of wars. After the war, we need to rest and choose the direction again after accumulating strength; on the other hand, the confidence of market participants also requires time and news to recover.
molecule will indicate in the future that once BTC stands firm at the 10,000 US dollar mark, it may rise; once it falls, it will fall. "From today's daily chart, BTC has the risk of continuing to decline."
Bitcoin fell by only 10% in the past week, but altcoins fell by more than 20% and even halved. Mainstream coins including ETH, LTC, XRP, and EOS have shrunk by nearly 20% in the past 24 hours.Why is Bitcoin a situation where one is the only one, one is super and many are weak?
Clipper Coin Capital Managing Director and Future Money Partner Li Zhe said that the reason why other coins have fallen more and rebounded less is because the main positive news of the previous round of rise is that the funds for institutions entering the market are mainly BTC.
molecule believes that in the future, it is mainly due to the blood-sucking market of Bitcoin. Bitcoin and altcoins are currently in a "circle". Bitcoin has risen significantly, altcoins have risen slightly, and funds are slowly transferred to Bitcoin. Due to the lack of funding support, when the market falls, altcoins have fallen even more, and more funds tend to Bitcoin, forming a cycle. Unless one day, most people think that the price of Bitcoin has reached its peak, funds will slowly flow to mainstream coins and altcoins.
K said: "The bull market is also divided into multiple types, including general rise, round rise, and structural rise. Previously, our statistics show that the correlation between BTC and other mainstream currencies has shown a downward trend in the past two months, which is one of the characteristics of the structural market. Weak funds are driven by the inflow of funds outside the circle, so the deep and high consensus BTC is strong alone. Here is also a suggestion for investment: The strong will always be strong, and the weak will always be weak. The strong will go long in the rise, and the weak will short in the fall."
news side negative
From the news side, there are the following negative stakes in this BTC decline.
First, the exchange is frequently stolen. 7 On July 12, Bitpoint Japan confirmed that crypto assets were stolen. The stolen currency can be determined to include XRP, with the preliminary loss estimated at around 3.5 billion yen. In addition, South Africa's largest payment gateway shuts down Bitcoin transactions. Due to high transaction fees and network congestion, South Africa's largest payment gateway no longer supports Bitcoin transactions after July 20, and the company also claims that Bitcoin has many restrictions and design flaws and cannot be a better cash alternative.
Secondly, Libra, the Facebook stablecoin project, has also encountered many setbacks recently. includes an upcoming hearing from the U.S. Congress, as well as a liaison meeting between the Japanese Ministry of Finance and the Department of Finance and the Bank of Japan on libra.
This month, Fed Chairman Jerome Powell and US President Trump both raised questions about Libra in public. Speaking to the U.S. Senate Banking Committee, Powell said he doubted the feasibility of Facebook launching Libra on its set schedule, saying Libra has caused a lot of serious concerns, including privacy, money laundering, consumer protection and financial stability. Trump criticized Facebook's cryptocurrency Libra on Twitter, which has no status or reliability; at the same time, ECB Management Committee Villeroy, Bank of England Deputy Governor Kanliff, and French Economic Minister Le Maire all made negative remarks on Libra.
Finally, institutional funds were also considered to be favorable to the currency circle, and this conclusion was overturned. Binance founder Changpeng Zhao said he did not see institutions growing at a faster rate. Although both Binance's institutional and retail transactions are growing, retail investors account for about 60% of trading volume, roughly the same as last year.
Future trend
Regarding the future trend, analysts still respond with an optimistic attitude.
Binance Research believes that it is understandable that assets such as cryptocurrencies with vague intrinsic value decline briefly after the Fed interest rate meeting, because the attention of funds is temporarily shifted to traditional core assets, but this situation may not last long, because the investment world cannot do without "mean return". When the valuation of traditional core assets is too high and the cost-effectiveness gradually decreases, the attention of funds will naturally come back, especially in the long run, the continuous easing of the fiat currency world will only further enhance people's belief in crypto digital currencies.
Huobi.com's special analyst Bao, believes that "the support level for the next round is still the 9832 and 8843 lines as mentioned earlier. Given the current oscillation pattern in the medium-term, after the low support is verified, there is still an opportunity for an upward band to rebound, just like the market before last Wednesday. However, it is necessary to prepare to support breaks, oscillate patterns at the high level, and turn into a main decline short trend pattern."
molecules believe that the future BTC trend lies in whether it can maintain the 9800, 9000, and 7600 US dollars mark. "I personally believe that there will be an accelerated decline before the end of the decline, so first look at whether the 9800 US dollars can (form) double bottom (support). Long-term bullishness, but weak in the medium and short-term. "
Xiaojingku said that BTC is still relatively strong at present and can be purchased at the right time. "We tend to think that it is normal for big cakes (BTC) to pull back to 30-40% at each high point. Relatively speaking, we think we can enter the current position. "
analyst Leo believes that from the daily chart, BTC has fallen below the 30-day moving average (10964 USDT), which is also the first time BTC has fallen below this support level since March 4 this year; at present, the most important support level for BTC is the 60-day moving average (9500 USDT), and once it falls below, it will be bearish to 8000 USDT.
(BTC daily chart: green line is 30-day moving average, yellow line is 60-day moving average)
K Ye believes that historical data shows that each pullback is more than 30%, with a minimum drop of 32%, and a maximum drop of 50%. Calculated by the 32% minimum pullback standard, OKEx The highest price of Bitcoin quarterly contract is 14460, down 32%, and the theoretical support is 9832.8 USD.
screenshot from OKEx Bitcoin quarterly contract daily K-line chart
"As shown in the figure, the low point of the previous round of adjustment is 10032.92 USDT, which is very close to our data to calculate the support price of 9832.8 USDT. Therefore, here will probably form a stop-fall support, followed by the technical support level near 9200 USDT. "K Master said.
Li Zhe concluded that 2019 itself is the year of layout, and the big market is in the second half of 2020. I hope everyone will invest in fixed investment + do not leverage + do not get off the car.
has predicted by foreign analysts. Maybe we will soon know whether the bears can fully control the cryptocurrency market, because the market is currently at a critical moment when they must be held, otherwise there may be further plummeting.
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