BTC Revisits Previous Low, Will the Frenzy Bull Market Continue into the Second Half? | Trader's Insight

With the improvement in U.S. employment data, November JOLTs job openings significantly exceeded expectations, leading to a widespread reduction in the expected interest rate cut by the Federal Reserve. As a result, the cryptocurrency market, gold, and U.S. stocks all experienced declines. BTC quickly plummeted from a high near $102,000 to $94,000 and showed a minor oscillating downward trend over the next two days, reaching as low as $91,000.

Adding to the negative sentiment, various bearish news emerged, including the Ethereum Foundation's sale of another 100 ETH and the U.S. Department of Justice being authorized to sell $6.5 billion worth of Silk Road bitcoins seized. This inevitably raises the question: Is the bull market still intact?

Trump's inauguration date is set for January 20, and this downturn may be a cleansing of long leverages to alleviate the overloaded market, allowing for a healthier continuation of the uptrend. Alternatively, it could indicate that the market has already priced in the expectation of Trump assuming the U.S. presidency, entering a stage of distribution. Let's see how traders interpret this.

Macro Analysis Camp

@Maoshu_CN

The new 30-year bond auction saved the U.S. stock market. The focus is currently on the NFP data's volatility. The auction raised $220 billion at a bid rate of 4.913%, below the 4.920% market yield post-auction. A bid rate below the market rate indicates that the auctioneers are satisfied with the 4.913% yield, suggesting that the short-term long bond yields have reached a temporary plateau. Short-term yields are unlikely to rise significantly, with expectations of stabilizing or decreasing rates, improving the corporate financing environment and weakening bearish sentiments due to strong market demand. Most importantly, this auction dispelled fears of further increases in long-term bond rates. For BTC, the most crucial aspect on Thursday is to stabilize in a range, undergo partial turnover, and patiently await Friday's job data release. The outcome of this week's employment data will hopefully not be too bleak, as BTC's price structure may otherwise break below the daily range.

@Phyrex_Ni

The Fed's current interest rate cuts are based on both economic and inflation indicators. From an economic perspective, the focus in the short term is more on labor data, leaving aside inflation, which currently seems to be within the Fed's expected range. Furthermore, a short-term decrease in inflation requires economic cooperation.

The key point here is labor, which Powell has repeatedly emphasized. There are two key points regarding labor: one is the unemployment rate, and the other is wage growth.

The previous value of non-farm employment was 227K, with a market expectation of 160K. Based on this data, a probable scenario is a decrease in non-farm employment, with the unemployment rate likely to remain unchanged or slightly increase. Therefore, theoretically, this is slightly more favorable. If the unemployment rate is rising but employment is also increasing, it should be a significant positive. However, if the unemployment rate is rising and employment is falling, it indicates a declining trend in the U.S. economy.
Moreover, this data is completely opposite to Tuesday's job vacancies because job vacancies mean that employers have more labor demand, which should reduce the unemployment rate and improve employment data. Consequently, the market expects the economy to perform well, and the Fed to reduce or maintain the number of rate cuts.
However, if Friday's non-farm data shows an increase in the unemployment rate and a decrease in employment, it means that the Fed will open up more rate cut opportunities. Additionally, it's a bit early to talk about an economic recession now, as the market data is still good. Therefore, I think if it does occur, it should be a slight positive. Of course, if the market insists on interpreting it as an economic recession, then there's no way around it. Therefore, unemployment rate data can always be interpreted as bad data: an increase in the unemployment rate could be seen as a sign of an economic recession, leading to an increase in the number of rate cuts. A decrease in the unemployment rate could be seen as an indication of a strong economy, with the number of rate cuts remaining unchanged or decreasing.

Technical Analysis Enthusiast

@CryptosLaowai

On the Bitcoin daily chart, there is currently a very obvious head and shoulders pattern. The news of Silk Road's sell-off approval on December 30th at 94k, suspected market manipulation information, led to a short-term bottom at 92k. The pattern suggests breaking through the 100k trend line, testing 104k to lure more buyers, followed by a major market crash.

@caifuziyou688

The long-term trend remains intact.

The short-term trend still follows higher lows and higher highs.

In summary, the bullish trend continues. Hold on to your positions. The current trend falls within the scope of a double dip.

@Xbt886

The last night's drop hit all the stop losses of the low point longs, and then reclaimed the 7-week VAL position, which is a strong bullish signal.

@Alan416993125

Next week is likely to see the low point of this correction, probably at the yellow circle position. After reaching the yellow circle, there might be a 14-28 day consolidation phase before launching an upward movement, with a target of $116,500.

@TheCrowtrades

As mentioned earlier, $94,600 is a key level.

If we manage to stay above it, $100,400 will be the next target.

Data Analysis Gang

@CryptoPainter_X

The distribution of the current futures market intense liquidation zone is as shown in the chart. Last night's rapid drop liquidated the long liquidity accumulated two weeks ago. Looking at the liquidation records on the chart, the market is still in a back and forth liquidation structure under a volatile background, meaning it moves towards where the liquidity is. If it weren't for the non-farm payroll data on Friday, I would have thought the support here was effective, and the pullback was enough. However, the question lies in how the market views the non-farm payroll and how it reacts, which is completely unpredictable. Therefore, whether there will be a rebound from the bottom here or not will depend on tonight's data.

@roger73005305

The air force has a multiplier of 8, the last time this multi-force ratio was at 8.5 at the end of the 5.2k bottom and the 4.9k two probes, it felt like a clear forced selling activity, driving all retail investors to the air force, and during the crash, market makers and whales again withdrew a large amount of BTC from CEX.

@Felix_Hsu

From URPD data, the early profit chip exit was the main reason for the price drop. Due to the sharp decline, it exacerbated stop-loss from losing positions. But still saw many "buy the dip" between 92000-94000. BinanceBTC fund chart shows a continued distribution trend. Let's wait for the weekly line death cross.

Option Market Data

According to Deribit data, $1.8 billion worth of BTC options will expire and settle today, with a Put/Call Ratio of 0.66, and a max pain of $97,000. Additionally, $460 million worth of ETH options will expire and settle today, with a Put/Call Ratio of 0.48, and a max pain of $3450.