Market Review

In the previous round of trend forecasts, we captured the last round of bullish signals in the market. After reaching the profit-taking arrangement of 69,000 for Bitcoin and 3650 for Ethereum, the market started the second round of daily-level retracement. This was also the result of a series of negative economic data in the recent macro market, with strong employment and inflation data affecting the expectations of interest rate cuts for the year. At the same time, the FOMC made decisions on the upper limit of interest rates, and Powell made a speech on the summary of economic expectations. It can be foreseen that another turning point in the market trend will appear. Whether the expectation remains unchanged and more data is needed to decide on an interest rate cut or the strong inflation policy needs to continue to tighten, either one will have a huge impact on the market.

Intraday Analysis

From the decline in the early market, it is not difficult to see that, given the current macroeconomic performance, the market generally reflects a pessimistic attitude. Institutions are selling off, and retail investors are fleeing the market. Bitcoin fell by more than 4,000 points to around 61,500, while Ethereum's decline synchronized to around 3150. The prices returned to the chip-intensive area at the same period. From the market performance and the upcoming data expectations, there is still room below, and the bottom has not yet appeared. After all, from the original expectation of an interest rate cut to the current uncertain outlook, the bullish sentiment has caused a huge blow. Before a clear bottom is formed, the bears still have plenty of room.

Let's talk about tonight's interest rate decision. Although affected by the negative impact of the data, maintaining the interest rate this month is almost certain. However, the market's previous expectation of three interest rate cuts in 2024, each by 25 basis points, has already begun to shift. The strong economic performance at the beginning of the year forced the FOMC to reconsider its original plan. Will they lower the interest rate expectation or wait and see? Some may ask, will there be a rate hike again? In fact, from the FOMC's decisions over the past year, we can already confirm that the era of high interest rates has ended. To prevent possible financial crises and the existing and persistent bank risks, the FOMC will not easily start a rate hike. So, we only need to bet on the remaining two possibilities.

Market trends are a microcosm of market sentiment, and market sentiment will be reflected in the market. In fact, a lot of information has already been revealed from the market. First, the low point of this round of decline has completely recovered the gains since March, and the bottom is also approaching the key support. Whether it is the breach of the 60,000 mark for Bitcoin or the drop below 3000 for Ethereum, it will be a sign of the continuation of the bearish trend. However, the current market dominance is still bullish. This is just the first round of retracement in the bull market. The macroeconomy also has a bottom, but the positive expectations have decreased. Therefore, it is not very rational to bet on a large decline. It is the most prudent choice to arrange long positions at the lower support level.

Intraday Suggestions

For Bitcoin, focus on short positions around 63,000 and arrange them to around 61,100 to 60,700. Arrange long positions around 60,500 and reserve positions to fill in around the previous low of 59,200. Be prepared for defense at the lower levels. For Ethereum, focus on short positions around 3230-3250 and arrange them to around 3010. Arrange long positions around 3005-2980 and be prepared for defense at the lower levels.

For more strategic guidance, follow Yunsan's Weibo, 500,000-follower financial analyst: Blockchain Yunsan

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