Master Discusses Hot Topics:

Since yesterday's takeoff, today has seen a rapid decline. The drastic fluctuations in Bitcoin are akin to an allergic reaction in the market. After Bitcoin broke through 100,000, the market naturally faced a wave of liquidations. Many long positions chose to lock in profits above 100,000, and the lack of funds to take over led to a significant pullback.

This kind of volatility is understandable; the tug-of-war between bulls and bears is always like this. In a bull market, sharp spikes are commonplace, and prices will continue to be washed by these short-term fluctuations. The market is likely to persist until the first quarter of next year.

After this round of Bitcoin's pullback, the funding rate has returned from 0.1% to 0.01%, and borrowing rates have dropped from an annualized 80% to 30%. These changes may seem like market adjustments, but it is precisely these repairs that have released Bitcoin's risks, increasing the chances of continuing to hit new highs.

Thus, the market's explosive rise and sudden drop is essentially a performance of "Dragon-Slaying": a sharp rise followed by a sudden drop, and then another sharp rise. This is the norm of capital games, not a sign of a trend reversal.

Every major drop is meant to clear out those heavily leveraged long positions. Friends controlling their positions should remember to stay defensive and not lose their footing due to a sudden drop.

As for tonight's non-farm payroll data, last night's market felt like it was pricked a few times, with fluctuations so large that they caught many off guard. However, I believe tonight's non-farm data is unlikely to cause further sharp drops. Even if the main players are acting poorly, they must restrain themselves, as the fundamental indicators for small to medium levels still need time to recover.

Currently, the recovery seems to be progressing well. Therefore, tonight, it is unlikely that the non-farm data will trigger a new wave of sharp declines; instead, it may lead to some rebound gains. One point to consider: if the non-farm data is negative, it means the Federal Reserve may not cut interest rates in December, which would inevitably lead to a rise in market risks and could even trigger large-scale short positions.

However, the probability of this situation occurring is very low. We should not view market fluctuations with a retail mindset: after a major drop, there will always be a group of people starting to short, thinking that the earlier they short, the more profit they will make. In the end, they get trapped in their short positions, and everything is left unsaid…

Therefore, under the influence of the U.S. stock market and non-farm data tonight, the best strategy is to buy on dips, with a straightforward approach. Although Bitcoin's market is currently on a one-sided rise, short-term fluctuations are the norm.

The upcoming risk time points to note are: the Federal Reserve's interest rate meeting on December 18-19, and Japan's 66% probability of raising interest rates in December. If rates are raised, the market will certainly experience fluctuations, and after the volatility, negative news will settle, and positive news will quickly rebound. In the short term, there may be sharp movements, so do not let emotions dictate your actions.

That said, we must understand that Japan's interest rate hike in December, while appearing to be negative news, is actually its last rate hike, so this negative will soon turn into a positive.

Currently, the U.S. stock market and the cryptocurrency market are in a bull market cycle, and the impact of such adjustments is usually digested by the market within 1-2 weeks. Therefore, around the 20th of this month, it might be worth looking for short positions to bottom out.

After next week, short-term risks will require even more vigilance, and the discipline of taking profits and cutting losses must be stricter. However, from a medium to long-term perspective, these short-term fluctuations will not shake the direction of the larger trend; the bull market pattern remains robustly upward.

Additionally, don't forget about the U.S. core PPI data for November next Thursday evening. If there is an increase from Monday to Tuesday, then Thursday evening may see a sharp movement that could create bottom-fishing opportunities. As long as the low long positions are controlled properly, these short-term fluctuations could actually be a good time to enter.

Master Looks at Trends:

Yesterday, Bitcoin failed to break through the high point, forming a double top pattern before a significant drop. However, the market's buying momentum has not diminished, and overall sentiment remains optimistic.

Resistance Levels:

First Resistance Level: 98,600

Second Resistance Level: 100,000

Support Levels:

First Support Level: 96,700

Second Support Level: 94,800

Today's Suggestions:

Currently, we are in a consolidation phase after a decline, not a sideways market, but rather forming a long lower shadow, indicating that buying pressure still exists. Therefore, attention can be paid to the price movements around 96K to 98K. We are also in a V-shaped rebound, so Bitcoin needs to gradually break through the resistance at 98K to 100K, accompanied by significant trading volume.

12.6 Master’s Band Trading Recommendations:

Long Entry Reference: Light long positions in the 96,200-96,700 range. If there is a pullback to the 95,300-94,800 range, go long directly. Target: 98,600-99,650.

Short Entry Reference: Light short positions in the 99,650-102,000-103,000 range. Target: 98,600-96,700.

This article is exclusively planned and published by Master Chen (WeChat public account: Coin God Master Chen). For more real-time investment strategies, liquidation, spot trading, short, medium, and long-term contract trading techniques, operational skills, and knowledge about candlesticks, you can join Master Chen for learning and communication. A free experience group for fans has been opened, along with community live broadcasts and other quality experience projects!

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