Market Discrepancies Intensify: Has the Rebound Turned into a Reversal or a Downward Correction?

As the open interest in Bitcoin rises and key price levels on the liquidation map are intensified, market divergences have further intensified. Currently, there are two main viewpoints: one believes that the current rebound may turn into a reversal, while the other believes this is the second distribution of a downward correction.

Both viewpoints are based on supply and demand analysis, but they reach completely different conclusions. Proponents of the rebound perspective believe that demand exceeds supply, while supporters of the downward correction perspective argue that supply exceeds demand.

Price trends are essentially a visualization of supply and demand relationships. The ebb and flow of the forces between buyers and sellers results in price fluctuations, and each candlestick reflects changes in the supply and demand structure.

From the perspective of supply and demand, there are three main reasons supporting the view of a reversal:

1. The change in profit and loss status between long-term holders (LTH) and short-term holders (STH). When LTH is generally at a loss, it often indicates a market bottom. Currently, the proportion of LTH losses has risen from nearly zero to 1.9%, approaching a critical range. The change in profit and loss ratio of STH also shows that market confidence is recovering.

2. The supply and demand relationship between stablecoins and Bitcoin (BTC-SSR). The current market value of stablecoins continues to rise, which is expected to drive up the market value of Bitcoin.

3. The high and low chip concentration zones create a double anchor effect. Currently, approximately 11% of chips are concentrated in the two ranges of $60,000-$70,000 and $93,000-$100,000, which may limit the price to fluctuate between $70,000 and $93,000.

The viewpoint that supports secondary distribution believes that the US stock market has entered a technical bear market, and Bitcoin cannot remain unaffected. They argue that the performance of the US stock market completely aligns with the characteristics of the Wyckoff distribution phase, including initial supply points, buying climaxes, natural pullbacks, secondary tests, weak signals, and typical patterns of upward breakouts followed by pullbacks.

Market divergences have intensified, and investors need to choose suitable strategies based on their own judgment. Regardless of the viewpoint chosen, operations should be conducted cautiously, and risk management should be well-prepared.