The "Tug-of-War" Between Market Sentiment and Macroeconomic Conditions
The recent market has been sluggish, with BTC rebounding from the $78,000 low on February 21 to $95,000, but then falling back to around $81,000 last night, with the bulls and bears in a tug-of-war and the market direction unclear. Although Trump's "pro-crypto" stance temporarily boosted market confidence, its impact was ultimately short-lived and failed to reverse the overall market weakness, and the potential macroeconomic risks remain the "Sword of Damocles" hanging over the market.
CryptoQuant CEO Ki Young Ju believes that the BTC market may continue to linger in a depressed state until there is a substantial improvement in the US market sentiment. Amidst the uncertainty of regulatory policies, the complex and volatile macroeconomic environment, and the continued fluctuations in investor sentiment, whether BTC can maintain its high position in the long run remains to be seen.
Before stronger market catalysts emerge, BTC may continue to fluctuate within a wide range, and investors need to closely monitor market trends and capture key signals.
After Losing the $90,000 Support, the Bulls Face Severe Challenges
Although the market has attempted to rebound multiple times, BTC and the entire cryptocurrency market are still under pressure and have not been able to establish a sustained upward trend. Many analysts have issued warnings that if the bulls want to reverse the downward trend, they must act quickly to regain the key levels, otherwise BTC may face further downside risks.
However, Ki Young Ju believes that it may be premature to declare the end of the bull market cycle. CryptoQuant's on-chain data shows that market on-chain activity is still relatively calm, and the key indicators are neutral, indicating that although the market has been weak recently, the overall bull market pattern may not have been disrupted. In addition, the fundamentals of BTC remain solid, with more mining machines continuing to come online, reflecting the confidence of the market's major participants in the long-term prospects of BTC.
Ju further pointed out that if this bull market cycle were to end now, this may not be the desired outcome for the major stakeholders, including early "whale" investors, large mining companies, traditional financial institutions, and US President Trump, who have publicly supported cryptocurrencies. Retail investors are usually considered to be the late entrants in the bull market cycle, and their market behavior may not be sufficient to dominate the market direction at the current stage.
$85,000 Becomes a Key Liquidity Test, Will the Historical Cycle Repeat?
TradingView analyst believes that the more critical support for BTC in the short term is still $85,000, which has played a crucial role in the market tug-of-war in recent weeks.
If BTC continues to trade below $85,000 in the coming days, it may trigger a larger-scale market sell-off, with the concentrated release of selling pressure potentially leading to an accelerated price decline and further confirming the bearish sentiment, at which point BTC may face the risk of testing even lower support levels.
Quinten posted on the X platform: Looking back at history may provide us with some insights. In the previous bull market cycle, BTC experienced seven significant pullbacks, with magnitudes of -17%, -17%, -32%, -26%, -28%, -51%, and -25% respectively. Each pullback has triggered market panic, making people feel that the "bear market" has arrived, and whenever the price drops sharply, the market is often filled with the rhetoric of "Bitcoin is dead".
However, history has proven that BTC ultimately broke through the resistance and continued to rise. Admittedly, history does not simply repeat itself, but it often remarkably resembles the past.
In summary, the $85,000 and $90,000 price levels will become the focus of the short-term market tug-of-war between the bulls and bears, and investors need to closely monitor the gains and losses at these two key levels to assess the next market direction.
According to analyst MasterAnanda, the current market trend is quite "interesting" and is releasing some key signals worth paying attention to:
- Bottomed out or already explored: Last week, BTC fell 28% from its historical high of $109,000, reaching a low of $78,300 before rebounding strongly. This "bottom-up rebound" V-shaped reversal trend is often seen as a signal that a stage bottom has formed in the market, indicating a lower likelihood of further significant declines in the short term.
- Healthy correction in a bull market: After experiencing a strong bull market rally, a certain degree of pullback in the market is a normal phenomenon. This pullback helps to release the accumulated profit-taking in the market, and to accumulate new upward momentum for the market. Healthy adjustments can lay the foundation for a longer-term bull market.
- The "golden pit" of buying on dips: The current market pullback is actually providing a rare opportunity for off-market capital to enter the market. If you missed the previous BTC rally from $85,000 to $95,000, now may be a good time to position at relatively low levels. The market never lacks opportunities, and the pullback is an important "accumulation phase" in the bull market cycle.
- The long-term bull market trend remains unchanged: The long-term upward growth trend of BTC has not undergone a fundamental change. From a historical perspective, BTC is expected to regain its upward momentum in the coming months, gradually oscillating upwards. According to previous analyst forecasts, BTC still has the potential to challenge the $120,000 target price next month.
- Technical indicators provide support: Observing the BTC daily chart, the 200-day moving average (MA200) is playing a key support role, and MA200 has long been seen as one of the most important technical indicators for judging the long-term trend of cryptocurrencies. The current BTC price trend is forming higher lows, suggesting that the bullish trend may be further confirmed.
- Market sentiment and capital accumulation: This cycle is not simply driven by U.S. government policies or geopolitical events, but also follows the cyclical laws of the market itself. BTC has already prepared to enter a new growth phase and is expected to set new highs again in 2025. In addition, there is still a large amount of capital waiting in the market, and once the market stabilizes and rebounds, these funds are expected to accelerate their entry, further boosting the market upward.
In summary, BTC may have reached a stage bottom, and the market is entering a "accumulation phase" of oscillation and accumulation. Although short-term market volatility is inevitable, the long-term bull market trend remains solid. Investors can seize the current pullback opportunity, deploy in batches at relatively low levels, hold patiently, and wait for the market to ultimately choose its direction.
