EMC LabsBTC Weekly Observation (8.5~8.11): Depth adjustment attracts bottom-fishing funds, BTC maintains high-level oscillation zone

Author: Shang2046

The market, project, currency, and other information, opinions, and judgments mentioned in this report are for reference only and do not constitute any investment advice.

Weekly Market

Last week, BTC opened at $58,161 and closed at $58,712, falling to $49,000 on August 5th, with a volatility of up to 23.63%, making it the second largest week this year. The largest volatility week of the year is not far away. At the end of February, BTC pumped $10,000 in a single week from $50,000 and set a new record in the following week.

After experiencing a high-level consolidation for as long as six months and two pullbacks of about 30% in Depth, BTC has currently broken through the rising trend line and the 200-day line, but still remains in the consolidation area of the new high.

As we mentioned last week, the reason for this round of decline comes from the yen’s interest rate hike, which triggered a stampede by arbitrage traders and concerns about the recession in the U.S. Fortunately, both of these two major negative factors have been corrected in the following time last week. The BTC price also quickly rebounded, reaching as high as $627,000.

The rapid decline did not shatter market confidence. We noticed the largest weekly capital inflow in the past 4 months last week. This is particularly remarkable considering the withdrawal of hundreds of millions of USDC by market makers such as Jump Crypto.

Of course, the dangerous situation is not over yet: short-term investors are in a loss state, the market is hovering near the 200-day moving average, and the September rate cut is gradually Price in, etc., which requires a long time to repair.

Time, also a fren of investors. The fourth Halving has passed 115 days, and although it reached a new all-time high before the Halving, the subsequent trend has not deviated from the usual historical trajectory. We are optimistic that all the fluctuations are creating space for a better trend in the next year.

There is still a long way to go to reach the All-time high, which usually takes about 500 days, making it the best time for new investors to enter.

Federal Reserve and Economic Data

After constantly blowing the market to reverse expectations of an economic downturn, the Federal Reserve further hopes that the market will not be so optimistic about the rate cut in September, not 50 basis points but 25 basis points. The Fed is observing current data: the probability of a 25 basis point cut in September is 51.5%, and the probability of a 50 basis point cut is 48.5%. The probability of a cumulative 75 basis point cut in the year is 49.4%.

Funding

Last week, there was a significant inflow of 2.336 billion US dollars into Stable Coin. Among them, USDT and USDC both experienced positive inflows, amounting to 1.031 and 1.304 billion respectively. These funds have become a decisive force for the rebound after this round of new lows.

BTC ETF channel, only 2 trading days of positive inflow in 5 trading days, with a net outflow of 169 million for the whole week. Since August, there has been a net outflow for two consecutive weeks.

Chip Supply

This week, the market continued to “go from short to long”, with long-term investors over 5 months increasing their holdings by 54,500 and investors under 5 months reducing their holdings by 52,600. The drastic changes in the market have exacerbated the reduction in short holdings, which have achieved 7 consecutive weeks of reductions.

Shorts re-enter the loss zone after a short-lived profit, with a maximum average loss of 14%.

On August 5th, the rapid decline day, more than 8.5 perfect BTC was deposited into the exchange, but the net accumulated BTC for the whole week was only 500 coins, which may mean that the majority of selling pressure has been effectively absorbed.

Miner group increased holdings by 100 coins, with continuous holdings for 3 weeks. This week, Russia has allowed enterprises (subject to approval) and individuals (below a certain scale) to legally Mining through national legislation.

BTC on-chain data

BTC adds Address, active Address remains in a mild recovery, the 30-day moving average continues the trend of last week and continues to slowly rise. Transactions remain flat from last week, and Gas revenue remains low.

Ecological Analysis

The Ethereum ecosystem has recovered well, with the number of new addresses, active addresses, and total transfers all back in the expansion zone.

Solana adds Address, active Address, and total transfer numbers all show some decline, but still maintain a relatively high level.

EMC BTC Cycle Indicator

EMC BTC Cycle Metrics is at 0.125, indicating a Bull Market signal that is waiting for further recovery interruption.

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EMC Labs (Emerging Labs) was founded by encryption asset investors and data scientists in April 2023. It focuses on Blockchain industry research and Crypto Secondary Market investments, with industry foresight, insights, and data mining as its core competitive strengths, dedicated to participating in the thriving Blockchain industry through research and investment, and promoting the well-being of humanity through Blockchain and encryption assets.

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