Important News on January 23:
- Justin Sun: The TRON team is working hard to reduce fees to provide a zero-fee stablecoin trading experience.
- The Legislative Council of Hong Kong is discussing the "Stablecoin Bill" today and reviewing the licensing framework for cryptocurrency trading platforms.
- Data: 50% of TRUMP/MELANIA holders have never purchased Solana ecosystem altcoins before.
- U.S. ETF experts: Cardano (ADA) may become the next cryptocurrency to apply for an ETF.
- The Financial Supervisory Commission of Taiwan plans to introduce a draft law on virtual assets in June, which may allow banks to issue stablecoins.
Conveying the path of trading, enjoying a wise life.
In the latter part of this month, Bitcoin may be affected by interest rate hikes in Japan, leading to a downward pullback. So if it falls back, should we intervene? Or at what point should we buy? The continuous outflow of Bitcoin from major platforms and exchanges signifies what? Today, let's discuss Bitcoin's market trends and this topic.
Let's take a look at Bitcoin's price trend; currently, its price is $102,900. On the 3-day chart, we need to pay attention to the position of the middle band of the Bollinger Bands. The first breakthrough of the middle band of the Bollinger Bands occurred in mid-October, and at the same time, Bitcoin's price broke through this resistance line, reaching a new high after hitting $67,000.
Therefore, this time, the second upward breakthrough after the drop becomes a very critical and symbolic action.
So if Bitcoin's price pulls back to the middle band of the Bollinger Bands at $98,100, it will encounter strong support at this level, and we can consider entering the market accordingly.
If Bitcoin's price pulls back again to our previous low point, at the middle band of the Bollinger Bands on the daily chart, at $99,000, it means that both the 3-day and daily charts have their middle bands around $98,000 - $99,000, so this area can be considered for entry. Unless it breaks below the middle band of the Bollinger Bands again, which is $99,000.
If it breaks below $99,000 or $98,000, then Bitcoin's price will test $96,000 and $91,500. Therefore, reaching the final price of $91,500, which is the previous level of support, has been tested multiple times without breaking.
To summarize, it might be a bit convoluted. The first support is $99,000, the second support is $98,000, the third support is $96,000, and the fourth support is $91,500. If $98,000 breaks, it is highly likely to reach $91,500. If it reaches $91,500, you must enter the market. If it breaks $98,000, then you can consider exiting in the short term.
For the medium to long term, you can enter at lower prices, which should be defined according to your trading style and cycle.
At the same time, we need to discuss why we say we can consider buying again if Bitcoin's price falls.
From the recent 30-day changes in Bitcoin quantities across major mainstream exchanges, including changes over 24 hours or 7 days, on Coinbase, a total of 25,402 Bitcoins were withdrawn in 30 days, with 1,143 withdrawn yesterday.
The second-largest exchange, Binance, withdrew 9,000 Bitcoins in 30 days, with 900 withdrawn yesterday. Bitfinex withdrew 27,384, with 562 withdrawn yesterday. This includes platforms like Gemini and OKX.
As mainstream exchanges see a continuous decrease in Bitcoin quantities, it indicates that a significant amount is likely being moved to wallets, suggesting that someone, whether whales, large holders, institutions, or even countries, is buying Bitcoin. From this perspective, more people are increasingly believing in Bitcoin, having faith in Bitcoin, and optimistic about its future price trends.
Therefore, if Bitcoin rapidly falls back, it can also be a good entry point. Is the current price a good entry point? I do not recommend buying at the current price. Why do I say this?
There is an indicator called the Bitcoin AHR999 indicator. This indicator represents that if the value is below 0.45, it indicates a bottom-buying opportunity; between 0.45 and 1.2, it indicates dollar-cost averaging; above 1.2, it is not suitable for operation, as the price may be relatively high.
Currently, this value is at 1.47, meaning that at 1.47, the 200-day dollar-cost averaging cost is $73,000, while the current price is $103,600. Therefore, it has exceeded 1.2, indicating that the price is in a high range.
Since the price is in a high range, we need to be cautious; it is not very suitable for operation. Only when there is a significant pullback or deep correction can we consider entering the market again. Moreover, this value was even higher yesterday, hovering above 1.4. Only when it returns below 1.2 can we consider further dollar-cost averaging. From this perspective, we should still be a bit cautious.
If Bitcoin experiences such a deep correction, I believe it is worth considering entering, especially at the middle band of the Bollinger Bands at $98,000; we need to pay attention to this point. If it has the opportunity to approach $90,000, this can be a key entry point, but it must not break; if it breaks, it will be more troublesome. This is the operation we will consider in late January.
It is not that the AHR999 indicator reaching 1.47 means we cannot buy; it just means there is not much advantage left. In past bull markets, we noted that this indicator's values were quite high.
The AHR999 indicator reached 80 in 2013; in 2017, it reached 24; in 2021, it peaked at 8.8; and in 2023-2024, it reached 1.85. Therefore, it is still quite far from the peak of the last bull market, which was 9.9, while now it is at 1.47.
Thus, when it is above 1.2, there may not be much advantage, but it does not mean the price will not rise further. Therefore, we need to view this issue dialectically.
If Bitcoin's price reaches the point we just mentioned for a pullback, it is actually a good time to enter, and we should not have excessive concerns. The indicator is just a reference.
Moreover, if it has the opportunity to reach higher levels, for example, reaching 5 or 6, you need to pay attention. Why should we pay attention when it reaches 5 or 6?
Because as each bull market approaches, or from a time cycle perspective, each high point is actually moving down, which indicates that the peak cycle of the bull market is becoming increasingly lower, and the values of the AHR999 indicator are also adjusting downward, which seems to be a pattern, indicating that the market is maturing.
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