This Week Review

From February 3rd to February 10th, this week, the highest price of navel oranges was around $102500, and the lowest was close to $91231, with a fluctuation range of about 10.99%. Observing the chip distribution chart, there is a large amount of chips traded around 95000, which will provide certain support or pressure.

• Analysis:

1. 60000-68000 is about 1.68 million pieces;
2. 90000-100000 about 261.75 million coins; • The probability of not breaking below 87000-91000 in the short term is 85%; • The probability of rising above 110000~115000 in the short term is 69%.

Important News Aspect

Economic News

1. Last Friday’s data showed that the US unemployment rate in January was 4.0% (previous value 4.1%).
2. Non-farm employment in January was 143,000 (previous value: 307,000).
3. The Fed has reduced its balance sheet by more than $2 trillion in this round. The initial size of the balance sheet has decreased from about $9 trillion to $6.87 trillion, and the overnight reverse repo size has dropped from the previous high of $2.5 trillion to $780 billion.
4. Last Friday’s Fed’s monetary policy report mentioned that it “plans to stop shrinking its balance sheet at an appropriate time”.

Cryptocurrency Ecosystem News

1. The Strategic BTC Reserve Act (Senate Bill778) in Texas, USA was submitted to the Senate Finance Committee for review on February 7th. The bill aims to establish a BTC reserve controlled by the state government to enhance financial security and promote digital asset innovation.

2. Cynthia Lummis, sponsor of the “BTC Strategic Reserve Act” in the United States and head of the Senate Banking Committee’s digital asset subcommittee, stated: If the United States uses 5% of the total BTC (approximately 1 million BTC) to establish reserves, then the U.S. debt can be reduced by half in the next 20 years.

3. Hartmann Capital founder Felix Hartmann said: I may be a little early, but I feel we are approaching the bottom, capital interest rates have been negative for a while, and futures premiums turned negative a few weeks ago.

4. AI tokens have dropped by 80-99%; high-quality alternative tokens have retraced to the long-term trend line, eliminating the excessive rise in the fourth quarter; market sentiment has completely collapsed, which is often the best signal, and today’s sense of despair feels as irrational as the frenzy in the fourth quarter.

5. The global market macro commentary magazine ‘Kobeissi Letter’ stated that the short position of ETH increased by 40% in one week, and has soared by 500% since November 2024, reaching an unprecedented level of shorting ETH, even surpassing any previous time.

6. On February 10, Michael Saylor said that Strategy (formerly MicroStrategy) increased its holdings by 7,633 BTC at an average price of $97,255, with a total value of about $742.4 million. Ryder’s stake in Strategy increased to 5%.

7. The participation of the younger generation, concerns about inflation, and Trump’s pro-crypto position are driving this growth, with BTC ETF expected to break through 250 billion US dollars, coupled with the accumulation of regulatory favorable, cryptocurrency is accelerating into the mainstream.

8. Currently, 27 states in the United States have shown strong interest in BTC, with Kentucky and Maryland legislators proposing “BTC Reserve” bills respectively, and a Florida senator proposing a BTC investment bill. Utah may become the first state in the United States to establish a BTC reserve, as they only have 45 days to make a decision.

9. Tischhauser said: If the United States establishes a BTC reserve, each additional inflow of 10 billion US dollars may trigger a multiplier effect of 200 billion US dollars in the increase of BTC’s market value. The potential demand impact will be very significant because the liquid supply of BTC is very small.

10. Economist Alex Kruger expressed that the current market is not as smooth as the previous bull market. First, the Fed turned hawkish in December last year, and then TRUMP caused huge volatility and liquidity loss. As for the crypto market, the most similar situation is May 2021 and May 2024. Alex believes that it will continue to rise after the turbulence ends.

Long-term insight: used to observe our long-term situation; bull market/bear market/structural change/neutral state Medium-term probing: Used to analyze what stage we are currently in, how long it will last in this phase, and what situation we will face
Short-term observation: Used to analyze the short-term market conditions; as well as the possibilities of certain directions and events occurring under certain conditions

Long-term Insight

• US encrypted ETF reserve flow • Long-term investor participation ratio
• Large amount transfer header • Short-term speculator cost

Although there will be some outflows or sales in some cases, there is still a willingness to buy in more cases, and the flow of funds to sell is not sustained.

The share of long-term participants has dropped further to 39%. The risks that may arise in the market in the future need to be gradually treated with caution.

After the selling pressure caused by the recent influx of funds and the resulting downward price test, the market has returned to a characteristic of gradually maintaining a willingness to buy. There is still a slight willingness to buy in the market.

The cost of short-term speculators has soared to $92,000, which will be a psychological barrier or a support level, especially as short-term participants account for an increasing proportion.

Mid-term exploration

• Incremental model • Liquidity Supply
• Whale Comprehensive Scoring Model • USDC Purchasing Power Composite Score
• ETH exchange trend net head • BTC exchange trend net head

There is a certain degree of growth and signs of supply increase in the increment, but the current volume is too small. The driving force for the market momentum has not yet formed, or the capital sentiment is somewhat cautious at the moment.

There is a visible increase in liquidity, mainly reflected in the fact that when the market is in a fluctuation or adjustment phase, the supply of liquidity will be supplemented and supported. It is possible that the current market liquidity has improved slightly, and the risk of deterioration in this stage may be alleviated.

The recent rating status of the whale is not clear enough, and it switches back and forth between the low and high states. It is possible that the whales in the market have significant differences in the current market game. If the rating status of the whale continues to maintain the current pace, there may be significant turmoil in the market. The current rating is ‘Medium’.

The purchase power rating of USDC still maintains a good level, which may indicate that the funds of US institutions have not made significant exits. During the current adjustment phase, the rhythm of US funds may affect the short-term performance of the market.

ETH exchanges have recently seen significant outflows, indicating that the community may be starting to accumulate. Currently, there has been a certain degree of compression in the supply of coins available for sale in the near term.

BTC still maintains a slow accumulation pace, and the community may still maintain an accumulation attitude towards BTC. With the gradual decrease in selling pace, the subsequent selling pressure of BTC may continue to decrease.

Short-term Observation

• Derivative Wind Risk Coefficient • Option intention-to-trade ratio
• Derivatives trading volume
• Implied Volatility of Options • Profit and Loss Transfer Amount • New addresses and active addresses • BitOranges Net Head of Exchange • Auntie Exchange Net Position
• High-weight selling pressure • Global purchasing power status • Stablecoin Exchange Net Head • Off-chain exchange data

**Derivatives Rating: The risk coefficient is close to neutral territory, and the risk of derivatives is moderate. **

The risk coefficient is in the neutral zone, and the current market state is more inclined to shock without special expectations.

The put option ratio is low, and the trading volume is in the middle.

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Derivative trading volume is once again at a low level.

The implied volatility of options does not fluctuate much in the short term.

Emotional State Rating: Neutral

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Last week’s sudden market downturn triggered a small amount of panic selling ( orange line ), but it did not lead to sustained panic. The current market’s positive sentiment ( blue line ) is also declining continuously. Overall, this state is more of a market oscillation.

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New and active addresses are at a medium to low level.

Spot and Selling Pressure Structure Rating: BTC and ETH are in a state of significant outflow accumulation.

The net position of the BTC exchange continues to accumulate with large outflows.

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The net position of the ETH exchange continues to accumulate with large outflows.

Currently, there has been a high-weight selling pressure, which has eased somewhat.

Buy Rating: Global buying power is in a state of outflow, stablecoin buying power is stable compared to last week.

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Currently, the purchasing power is in a state of erosion.

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Stablecoin purchasing power remains stable compared to last week.

Off-chain transaction data rating: 90,000 willing to buy; 100,000 willing to sell.

There is a willingness to buy at the price range of 90000~95000; there is a willingness to sell at the price range of 100000~110000.

There is a willingness to buy around 90000~95000; there is a willingness to sell around 100000~110000.

Willing to buy at around 90000; willing to sell at around 110000.

This Week’s Summary:

Summary of the message:

1. It is expected that the next interest rate cut and the cessation of balance sheet reduction may be in May-June.
2. The current supply of bitcoin is slowly decreasing to a very scarce level, and if the US strategic reserve is executed and a large amount of BTC is bought, it may have a 20x multiplier effect.
3. The Federal Reserve will shift to dovish, Trump supports encryption, and overall optimistic about encryption this year.
4. The situation of altcoins is very different from that of 2016-2017. At that time, there were only over 3,000 altcoins, but now there are nearly 300,000. It is also difficult for speculative funds to sustain the market value of altcoins and some altcoin markets. There is high uncertainty in the future.

On-chain long-term insights:

1. The willingness of US ETF funds to purchase still exists, but there is a slight selling state;
2. The proportion of long-term participants has decreased to 40%, and the vigilance needs to be gradually strengthened;
3. The large-scale transfer on the exchange still shows that it is currently in a relatively buying state;
4. Short-term speculators rise to around 92,000 US dollars, which is a support or psychological barrier.

• Market Tone: Buying interest still exists, and the market is gradually moving towards high volatility and risk.

On-chain mid-term exploration:

1. The incremental volume is relatively small, perhaps indicating that new participants are somewhat cautious at the moment;
2. Liquidity supply has improved; The giant whale population has recently been quite divided;
3. USDC funds sentiment is still on;
4. The accumulation of ETH has been large recently;
5. BTC is still accumulating slowly.

• Market Tone: Repair, caution Recently, there has been a significant divergence among whale groups, and the supply of liquidity has improved.

On-chain short-term observations:

1. The risk coefficient is close to the neutral zone, and the derivative risk is moderate.
2. The number of new active addresses is relatively low.
3. Market Sentiment State Rating: Neutral.
4. The net position of the exchange as a whole shows that BTC and ETH are in a state of large outflow accumulation.
5. Global purchasing power is in a state of loss, and the purchasing power of stablecoins is the same as last week.
6. The off-chain transaction data shows a buying intention at 90000; a selling intention at 100000.
7. The probability that it will not fall below 87000 to 91000 in the short term is 85%; The probability that it will not rise above 110000 to 115000 in the short term is 69%.

• Market tone: For BTC, the market sentiment remains neutral, with no panic and no positive sentiment. Looking at the chip chart, the chips on the chain are still “diamond hands”, and there is still some purchasing power accumulating chips. In the short term, it is expected that the market may continue to be volatile.

Risk Warning: The above is all market discussion and exploration, and does not constitute directional views on investment; please treat and prevent market black swan risks with caution.