Market Divergence Intensifies: Does the Rebound Turn into a Reversal or Continue to Fall?

The open interest of Bitcoin contracts has risen, and the key price levels on the liquidation map continue to be raised, further intensifying market divergence. Currently, there are mainly two viewpoints: a rebound turning into a reversal, or a second distribution in a downward continuation.

Both viewpoints start from the supply and demand relationship, but they reach different conclusions. The perspective supporting a Rebound believes that demand is greater than supply, while the perspective supporting a continued fall believes that supply is greater than demand.

Support for Rebound Perspectives

Mainly based on the following points:

1. The relationship between long-term holders (LTH) and short-term holders (STH).

• The LTH-RPC indicator shows that long-term holders are beginning to incur widespread losses, often signaling that the market is approaching a low point.
• The STH-RPC indicator shows that short-term holders are gradually turning to profit, indicating a recovery in market confidence.

2. The supply and demand relationship between stablecoins and Bitcoin ( BTC-SSR )

• The market value of stablecoins continues to rise, which is expected to drive the market value of Bitcoin up.
• The BTC-SSR indicator shows that the momentum of stablecoins flowing into Bitcoin is accumulating.

3. High and low chip concentration areas form a double anchor effect

• In the range of $60,000-70,000 and $93,000-100,000, about 11% of the chips are concentrated.
• This distribution pattern is expected to confine the price within the range of $70,000-$93,000.

4. The impact of tariff policies is gradually weakening.

• The impact momentum of a single event on the market is gradually diminishing.
• The effect of tariffs adding to the supply side is beginning to lose its effectiveness.

Supporting the view of continued fall

Mainly based on the following judgment:

1. The US stock market has entered a technical bear market.

• The performance of the US stock market in the past few months aligns with the characteristics of the Wyckoff distribution phase.
• From the perspective of volume and price relationship, the distribution has been completed, and it will continue to fall next.

2. Bitcoin is difficult to operate independently of the US stock market.

• The fall of the US stock market is inevitable.
• Bitcoin lacks sufficient independence and will be dragged down by the US stock market.

3. Macroeconomic risks are increasing

• Tariffs may trigger worsening inflation, leading to stagflation.
• The risk of economic recession is rising

Currently, market divergence is intensifying, with two viewpoints each having their supporters. The future trend depends on whether the U.S. stock market can stop falling and whether Bitcoin can move independently of U.S. stock trends. Investors need to closely monitor subsequent developments.