12/16 Crypto Market Weekend Summary:
Macroeconomic pressure has passed, where is the next hot spot in the crypto market? Market trading volume surges, is Christmas a blessing or a curse for the crypto market?
Hi, girls and boys, welcome to Uncle Cat Talking about Coins.
As of the time of writing, the price of Bitcoin is around 42,339. After a small drop last night, the market has been sideways again. From Friday to Saturday, the overall trading volume of the crypto market has increased several times. Where is the next narrative hotspot in the market? What kind of emotional guidance will Christmas bring to the market? Let's first look at the answer given by the technical side:
Bitcoin disk analysis:
Bitcoin has been trading sideways for a night and its shape has basically not stabilized.
In last night's article we mentioned two supports of 41,500 and 40,600. Among them, 41,500 successfully served as support to temporarily stabilize the falling market. The pattern brought about by the stabilization of the market was stable, and the daily Bollinger band middle line support moved up again.
The current effective support at the daily level is around 41,460, where the middle line of the daily Bollinger Band and the Fibonacci retracement level overlap. This will serve as short-term support for the daily line.
Although the stabilization of the market has brought stability, it has also brought technical threats. The current daily pressure in the short term comes from
The pressure of MA7 daily moving average, the current price is running within the MA7 line and the daily Bollinger band middle line, and is gradually compressed. This compression may cause the market to be forced to move out of a small trend at the weekend without any news stimulation. If the upper pressure is broken, the price will return to the safe range and there is a greater possibility of continuing to rise.
If the support is broken and the price moves to the lower track of the daily Bollinger Band, the market will change its form and trend and turn into a downward correction market, and there is a possibility of falling to 38,000 or even deeper.
Currently, in the 1-hour and 4-hour charts, prices are running at the lower Bollinger Band, and the small-level Bollinger Band middle line has formed effective pressure that needs to be broken through. In the short term, if the price breaks through 42,300, then the price will likely continue to rise to around 43,500.
However, if a price breakthrough cannot be achieved in the short term, then the MA7 moving average will show a trend of crossing the middle line of the Bollinger Band on the 1-hour and 4-hour, including the daily level. Once the trend is formed, there will be a "death cross" at both the hourly and daily levels, which will pose a great threat to the short-term market technically.
To sum up, the technical side has not yet stabilized. Although the rebound is obvious, there is also obvious pressure from above. Under the current circumstances, the price needs to break through the pressure level and stabilize in order to get rid of the technical pressure and stabilize.
Pay attention to the support and resistance levels to identify the trend direction.
Let’s take a look at the dynamics and funding changes in the crypto markets on Saturday:
The current market value of the crypto market is 1.66 trillion, and the market value has decreased by 1.3% in 24 hours, and the market value has decreased by 21.5 billion in 24 hours.
The data chart shows that the market value of the entire market began to shrink gradually from 20:00 last night. After a small rebound in the early morning, the market value fell again in the early morning until 8:00 in the morning when the Asian market took over the copycat trading, causing the market value to rise again.
The current market transaction volume is 295.5 billion, which is 3.5 times that of yesterday. This transaction volume is already the highest transaction volume in the second half of this year.
Currently, Bitcoin accounts for 49.6% of the market, Ethereum accounts for 16.2% of the market, and the stable market value is 131 billion, accounting for 7.87% of the market.
The market value of Bitcoin is 825.4 billion, the market value has dropped by 1.61% in 24 hours, the market value has decreased by 13.2 billion in 24 hours, and the trading volume has decreased by 27.2% in 24 hours. The current trading volume is 18.5 billion.
From the above data, we can see that the overall market value has decreased, and the trading volume has increased dramatically. After the surge in trading volume, funds choose to remain in the market, the market value of stablecoins has increased, and their share has increased. Intraday market funds are still anchored in the copycat market.
Focus on capital flows:
USDT: The current market value is 90.8 billion, and the market value increased by 0.02% in 24 hours. The increase or decrease in market value is not large, and the trading volume decreased by 19.43%. The current trading volume is 41.6 billion.
The data chart shows that there have been large fluctuations in capital flows in Asia, with frequent short-term inflows and outflows of funds and increased liquidity. There was an obvious inflow of funds at 10 a.m., and funds began to flow out from the afternoon. The overall 24-hour inflow and outflow of funds remained unchanged.
USDC: Current market value is 24.6 billion, 24-hour increase of 0.6%, 24-hour market value increase of 147 million, 24-hour trading volume decrease of 18.9%, and current trading volume is 5.3 billion.
The data chart shows that funds began to flow out slightly before the U.S. stock market opened yesterday. At 6:20 in the morning when the U.S. stock market closed, funds began to flow into the crypto market in large quantities. The U.S. stock market was closed on the weekend, and funds chose the crypto market for short-term risk hedging.
According to the overall market dynamics, the market value has decreased, and the market value and trading volume of Bitcoin have also decreased year-on-year. The altcoin market has gradually become active, and the trading volume has surged, indicating that the current market liquidity has greatly increased and the long and short turnover rate has increased. This situation is mixed. If funds are sufficient and sentiment is good, a large amount of trading turnover can make the market more active, but if funds are insufficient, a large turnover will create a certain selling pressure.
Currently, the capital inflow into Asia is the same as yesterday. U.S. funds flowed into the market during the U.S. stock market close. However, the funds flowing into the market did not directly participate in transactions. Instead, they remained on the sidelines. The market value of stablecoins increased, their share increased, and the market's wait-and-see sentiment increased. There is a high probability that the inflow of U.S. funds over the weekend was just to come in and exchange for stablecoins for risk hedging.
The current weekend trading environment is relatively active. The current market needs new hot spots to activate funds that remain on the sidelines to participate in transactions. However, the current surge in trading volume does bring certain risks to the current market.
We will take a look at the macroeconomics and news later on over the weekend.
Macroeconomics and news:
Today, Saturday, the risk market also ended this week's turbulence. From the fearful wait-and-see on Monday, to the enthusiasm brought about by the Federal Reserve's speech on Wednesday, to the cold water on the risk market due to overly high expectations on Thursday and Friday, the risk market experienced ups and downs this week.
It's the weekend, and there is no new content to update about the macro economy and news, so let's talk about the upcoming Christmas, which is a time point that everyone is concerned about.
There are two things to watch out for at present regarding Christmas. First, the risk aversion caused by the closure of most global risk markets during Christmas will cause funds to flow out of risk markets. Will this outflow include the crypto market? Second, will miners sell off their stocks during Christmas to realize cash, thus causing selling pressure in the market.
1. Regarding the Christmas funding issue, most traditional risk markets are facing a holiday, and these funds will temporarily leave the market to avoid unnecessary losses due to large fluctuations during the holiday. This is normal in the stock market, futures, and gold markets, so traders will slow down their trading around Christmas. Will the crypto market accompany the outflow of funds from traditional risk markets? Or will it take over this part of the outflow of funds?
In fact, we can see from the recent weekend movements of US funds that risk market funds are hedging, which is actually turning the trading products in their hands into stablecoins or fiat currencies. After all, stablecoins and fiat currencies have small fluctuations and short-term fluctuations can be ignored. In the recent weekends of the crypto market, we will see different levels of US funds entering the market. We also understand from recent data that US funds tend to trade Bitcoin and Ethereum, but the prices of Bitcoin and Ethereum did not rise after US funds entered the market over the weekend. Why is this? That is because the inflow of funds is directly retained in the market after being converted into stablecoins, and no transactions are carried out. On the eve of the opening of the US stock market on Monday, funds are flowing back to the US stock market or other risk markets.
So based on these actions, I analyze that during the Christmas holiday, the crypto market may usher in a certain amount of funds flowing in for risk aversion. This part of funds will not directly participate in transactions, but the inflow of funds will bring something to the market. At that time, it will depend on whether there will be new hot ends and narratives in the Christmas crypto market to induce these funds to trade.
2. Regarding the issue of Bitcoin miners selling, I was quite pessimistic about this issue at first, but then I took a comprehensive look at the situation this year. Unlike previous years, Bitcoin has attracted many institutions as a hot spot this year. Traditional financial institutions also know that miners are companies and will inevitably cooperate with or acquire them in order to collect low-priced chips from miners, and miners can obtain operating funds, so they no longer have to sell Bitcoin in exchange for funds. This can be seen from the acquisition or cooperation of Bitcoin mines in the market in the past six months.
Secondly, even if Bitcoin miners want to sell their tokens, they may not sell them directly at the market price. Everyone benefits from the rise in Bitcoin prices, and miners do not want to disrupt the price all at once. Therefore, it is feasible to sell tokens moderately in exchange for profits. The recent surge in trading volume and the active market atmosphere have led to the market being able to take on some of the selling pressure. It is possible that by now, miners have sold all the chips that need to be cashed out this year.
In general, Christmas is not necessarily a pessimistic time for the crypto market. At least the closure of traditional risk markets will leave a lot of idle funds in the risk market. It is a good thing for these funds to enter the crypto market even if they do not participate in transactions. As for the selling pressure from miners, I think it is not a big problem and it is not an obvious negative factor.
Of course, the probability of negative news on Christmas is low, but it does not necessarily mean that the market will not fall back slightly. With the current market sentiment in the macroeconomics settled, the remaining narratives are ETFs in January, Cancun upgrades in the first quarter of next year, Bitcoin production cuts in May next year, etc. Then there is still a Christmas between the emotional hype in January. If there are no new narratives and hot spots, it is very likely that the market will fall back slightly during this period due to the lack of hot emotional expectations, especially Christmas. Many people think that the collective closure of traditional risk markets on Christmas will also affect the crypto market, so pessimism is inevitable.
Overall, it is normal for the market to pull back before Christmas. As long as the market does not deteriorate, a small correction is more conducive to the next rise. Of course, if new hot spots emerge during this period, market sentiment will be boosted.
The core of the market in the coming period will be new hot spots and narratives to continue the market trend until the ETF results come out in January.
Finally, I wish you all a happy weekend!
