Altcoins have fallen by more than 50%. Is the market outlook stable? How much will BTC fall? Will March 12 happen again?

The market fell as expected. In last week's capital analysis, it was clearly pointed out that US dollar funds continued to withdraw. Asian capital relays, but their sustainability is limited.

However, the speed of this decline was unexpectedly fast and did not feel like previous tops. Most altcoins are currently down about 30% or even more than 50%.

In fact, when the market first starts to fall, there will be the irrational impact of the representativeness bias in behavioral economics, and most retail investors will not panic. In the past two days, there has been some panic. There are a few questions to consider next:

Question 1: Should the meat be cut at this location? Cutting the flesh at the current location may not be a wise move.

From a technical perspective, the current position is at the lower boundary of horizontal support and the descending channel, with dual support. And altcoins generally fell sharply. In the short term, even if there is a decline, it is likely to be just a pin. In addition, judging from historical experience, even if BTC experiences a sharp decline, the initial first wave of decline will often organize an effective rebound. Because at this point, many funds will think that this is just a callback in the upward process, and will enter the market to buy at key positions.

Of course, this is only a high probability situation. If a small probability situation occurs, don't blindly pursue a rebound. If the short forces are particularly strong, then the possibility of continued decline also exists. The basis for judgment is very simple, that is, it fell on heavy volume and fell below $59,000, and could not recover.

Question 2: Follow-up market trends

Many believe this is a pullback in a bull market. This view is not entirely wrong, but the magnitude of the pullbacks varies. I think the market will continue to be weak in the next 1 to 2 months, and the current position is most likely not the end of the correction. Because BTC has experienced a 6-month rise since it started rising in mid-September last year. The overall market has gone through a complete cycle, with major altcoins generally rising, sectors rotating, and many funds making a lot of money. And now the funds entering the market have become very tight. For example, last week there was an additional $13 billion in stablecoin issuance, including $8 billion in USDT, but BTC still fell from $73,000 to $62,000.Every time after a complete market trend, the market needs to be reshuffled to squeeze out the bubble.

Question 3: How much will BTC fall?

There is no definite answer to this question, and the main reason is that BTC ETF introduces financial power. The daily trading volume of ETFs is approximately $406 billion. In comparison, Coinbase has a trading volume of $2 billion and Binance has a daily trading volume of $608 billion. Therefore, ETF funds have become a very important force. However, due to the limitations of the opening time, we cannot understand the style of ETF funds. I have said before that it is definitely wrong to think that ETF funds will continue to buy. Many times, we must recognize our own shortcomings instead of making random assumptions.