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On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation

BlockBeatsBlockBeats2024/08/20 05:31
By:BlockBeats

The main factor affecting the market price in the market is no longer selling pressure, but the strength of buying power. Stronger buying power is needed to squeeze the selling space.

Original title: "The market is stagnant and the market is stagnant. How much selling pressure is there? | WTR 8.19"
Original source: WTR Research Institute


Review of this week


From August 12 to August 19, the highest price of Bingtang Orange was around $61,800 and the lowest price was close to $56,078, with a fluctuation range of about 9.34%.


Observing the chip distribution chart, there are a large number of chips traded around 59,000, which will have certain support or pressure.


On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 0


• Analysis:
1. 59000-63000 is about 1.38 million pieces;
2. 64000-68000 is about 1.16 million pieces;
• The probability of not falling below 54000~57000 in the short term is 70%;
• The probability of not rising below 64000~67000 in the short term is 74%.


Important news


Economic news


1. The monthly rate of US retail sales in July was 1%, 0.3% higher than expected and 0.00% higher than the previous value.


2. The number of initial jobless claims for the week was 227,000, lower than the expected value of 235,000 and lower than the previous value of 233,000.


3. The monthly rate of U.S. retail sales in July was 1%, the highest increase since January 2023, easing financial market concerns about a sharp slowdown in the U.S. economy.


4. Economist Peter Cardillo said that retail sales were much stronger than expected, reducing people's concerns about a recession, which is good news for the stock market. Analysts believe that the scenario of a soft landing of the economy is good, which is a positive catalyst for the stock market and may rise further.


5. The futures market raised the probability of the Federal Reserve cutting interest rates by 25 basis points in September from 65% on Wednesday night to 74.5%, and the probability of a 50 basis point cut was reduced to about 23.5%.


6. Fed's Musallem Cheng: No economic recession is expected in the next few quarters; US GDP growth is expected to be between 1.5% and 2% in the second half of this year; the time for interest rate changes may be coming soon.


Crypto Ecosystem News


1. Vanguard CEO Salim Ramji said the company will not copy its competitor (BlackRock) and will not launch a cryptocurrency ETF.


2. According to ai_9684xtpa data, LidoETH staking has had a net outflow for 12 consecutive days since August this year, with a total outflow of 74,304 ETH (about 194 million US dollars). Among them, JumpTrading redeemed 62,609 ETH from Lido.


3. According to Lookonchain data, a total of 955 million US dollars of stablecoins have flowed from Tether to Kraken since August 5.


4. Cynthia LoBessette, head of Fidelity Digital Asset Management, said that although the U.S. Securities and Exchange Commission (SEC) has not yet approved an ETF that can pledge ETH, this situation may change in the future because staking is an important part of ETH investment opportunities.


5. It believes that it is more of a matter of time than a matter of whether it will happen. Fidelity has had constructive dialogues with SEC staff to discuss the possibility of bringing a pledged ETH ETF to market.


6. Chuck Schumer, the majority leader of the U.S. Senate, said at the Crypto4Harris town hall meeting that the United States should find a balance for cryptocurrencies between promoting innovation and providing common-sense guardrails, with the goal of having the Senate pass a bill and incorporate it into law by the end of this year.


7. According to Bitwise statistics, based on the 13F position report submitted to the U.S. Securities and Exchange Commission (SEC), 44% of asset management companies increased their BTC ETF positions in the second quarter, 22% remained unchanged, 21% of institutions reduced their positions, and 13% liquidated.


8. About 66% of institutional investors hold or increase their BTC holdings through BTC spot ETFs (Form 13F is a quarterly regulatory report that all institutional investment managers with at least $100 million in assets under management must submit).


9. According to the 13F report submitted to the U.S. Securities and Exchange Commission: Goldman Sachs and Morgan Stanley bought a total of more than $600 million in BTC spot ETFs in the second quarter, of which Goldman Sachs spent about $418 million on BTC spot ETFs, most of which were BlackRock IBIT (worth about $238 million).


10. Morgan Stanley holds BlackRock IBIT worth $188 million, making it one of the top five holders of the ETF, with smaller holdings of ARKB and Grayscale GBTC;


11. According to Lookonchain statistics, the address marked as "US Government" has transferred a total of 15,940 BTC to Coinbase Prime in three times this year (10,000 BTC were transferred on August 15), with a value of approximately US$966.4 million. Within three days after the first two transfers, the BTC price fell by approximately 5%.


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


Long-term insight


• Large exchange net positions
• Illiquidity whales
• High-quality selling pressure
• Long-term investor position structure


(Long chart Large exchange net positions)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 1


The inflows and outflows of large transaction net positions show that large inflows are gradually decreasing, and the large selling pressure in the market is gradually decreasing.


(Figure below: Illiquidity Whale)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 2


The huge group of illiquidity whales shows that they are still buying.

It shows that the market support still exists.


(Figure below: High-quality selling pressure)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 3


High-quality selling pressure began to decline further and is almost approaching the blue low selling pressure area.
High-weight selling pressure further declined.


(Figure below: Long-term investor position structure)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 4


The increase in holdings by long-term participants, and the resumption of buying behavior by long-term participants prove that they are optimistic about the future market.
The market has not yet formed a vacuum zone, is not fragile, and has not entered the conditions of a deep bear market.


Mid-term exploration


• USDC purchasing power comprehensive score
• Network sentiment positivity
• Liquidity supply
• On-chain spot total selling pressure
• Analysis of each price structure


(USDC purchasing power comprehensive score in the figure below)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 5


From the observation of this model, the buyer status presented by USDC shows that institutional users may have a high willingness to buy.
When their purchasing status has not weakened, there is still buyer support in the market.


(Figure below: Network sentiment positivity)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 6


Network sentiment is recovering, and the decline is narrowing compared to before.
The speed of the market in the short and medium term may depend on the speed of sentiment repair.
The current structure is close to August to October 23.


(Figure below: Liquidity supply)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 7


There are signs of gradual recovery in liquidity supply, and the previous lack of liquidity may be slightly alleviated.


(Figure below: Total spot selling pressure on the chain)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 8


The recent performance of the seller is relatively close to the overall decline in selling pressure.
It is possible that under the current state, the decline in seller power has affected the main body to become buyers.


(Analysis of the price structure in the figure below)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 9


The current top price of BTC stock is around 70317, and the long-term high profit zone rises to 79540.
Due to the narrow profit space, the current calculated range is limited, so the increase in the market will determine whether it can break through the top of the stock.

Short-term observation


• Derivatives risk factor
• Option intention transaction ratio
• Derivatives trading volume
• Option implied volatility
• Profit and loss transfer volume
• New addresses and active addresses
• Bingtangcheng Exchange net position
• Yitai Exchange net position
• High-weight selling pressure
• Global purchasing power status
• Stablecoin Exchange net position
• Off-chain exchange data


Derivatives rating: The risk factor is close to the red area, and the risk of derivatives is increasing.


(The following figure shows the derivatives risk factor)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 10


Last week, the risk factor touched the red area, and then the market continued to fluctuate as expected. This week, the risk factor is close to the red area again, and the market is still inclined to fluctuate or a small correction.


(Figure below: Option intention transaction ratio)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 11


Option transaction volume decreased slightly, and the proportion of put options was in the middle.


(Figure below: Derivative transaction volume)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 12


Derivatives trading volume fell back to a low level after the market stabilized.


(The figure below shows the implied volatility of options)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 13


The implied volatility fell slightly.
Sentiment rating: neutral to depressed


(The figure below shows the profit and loss transfer volume)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 14


Fear (orange line) and positive sentiment (blue line) both fell to a low range, usually the market will continue to fluctuate, but it also means the power to continue the next fluctuation.

Next, continue to pay attention to whether the blue line rebounds.


(The figure below shows the new addresses and active addresses)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 15


New and active addresses are at a low level.
Spot and selling pressure structure rating: BTC inflows are accumulating, ETH has a medium outflow.


(Figure below: Net position of Bingtangcheng Exchange)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 16


Although BTC has a small outflow at present, the large amount of chips that previously flowed into the exchange have not yet been digested.


(Figure below: Net position of E-Tai Exchange)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 17


ETH exchange net position is in a medium outflow state.


(Figure below: High-weight selling pressure)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 18


There is no high-weight selling pressure at present.


Purchasing power rating: Global purchasing power has lost a small amount, and stablecoin purchasing power has recovered a lot.


(Global purchasing power status in the figure below)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 19


America’s purchasing power is lost again.


(USDT exchange net position in the figure below)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 20


USDC exchange net position has rebounded significantly.


Off-chain transaction data rating: There is a willingness to buy at 57,000; there is a willingness to sell at 62,000.


(Coinbase off-chain data in the figure below)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 21


There is a willingness to buy at prices around 52000~57000;
There is a willingness to sell at prices around 61000 and 65000.


(Binance off-chain data in the figure below)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 22


There is a willingness to buy at prices around 54000~57000;
There is a willingness to sell at prices around 60000~63000.


(Bitfinex off-chain data in the figure below)

On-chain data for Week 33: Short-term rebound is limited and needs to wait for the end of institutional liquidation image 23


There is a willingness to buy at prices around 55000;
There is a willingness to sell at prices around 67000.


Summary of this week:


Summary of news:


From the latest submitted 13F position table, it can be seen that in the second quarter, about 66% of institutional investors held or increased their BTC positions through BTC spot. ETFs, including well-known investment banks such as Goldman Sachs, Morgan Stanley, and Bank of America. BlackRock and Fidelity's spot BTC ETFs alone hold a total of $31.6 billion in BTC.


Unfortunately, it did not promote a big rise in the market, due to the joint selling of MtGox, Jump Trading, Germany/US/Grayscale and other addresses in the second quarter. The increase in holdings by the head institutions hopes that encryption will outperform the traditional stock market in the case of subsequent water release. Historically, the currency market has indeed performed well in the monetary easing cycle. Unfortunately, a large number of bankrupt institutions last year and the year before last, that is, in 2022, have been liquidated recently, suppressing prices. In the short term, it will need to wait for these liquidations to end before it can return to its alpha properties.


Long-term insights on the chain:


1. Large selling pressure is decreasing;


2. Illiquid whale groups are still buying, supporting the market;


3. High-quality selling pressure is also decreasing, approaching the edge of low selling pressure;


4. Long-term participants are buying again, and there are no deep bear conditions from a structural point of view.


• Market tone:
Selling pressure is decreasing and the market is becoming solid.


On-chain mid-term exploration:


1. Institutional users have high purchasing power;
2. The sentiment in the market is gradually recovering, and it has warmed up to a certain extent compared with before;
3. There are signs of a slight recovery in liquidity;
4. The selling power is declining;
5. The top price of BTC inventory is around 70317, and the increase in the market will determine whether it can break through.


• Market tone:
Accumulation
The main factor affecting the market price in the market is no longer selling pressure, but the strength of the buyer's power. It may take a stronger buyer's power to squeeze the seller's space.


On-chain short-term observation:


1. The risk factor is close to the red area, and the risk of derivatives has increased.
2. The number of newly added active addresses is relatively low.
3. Market sentiment rating: neutral to low.
4. The overall net position of the exchange shows that BTC inflows are accumulated, and ETH has a moderate outflow.
5. The global purchasing power has been lost in a small amount, and the purchasing power of stablecoins has recovered in large quantities.
6. Off-chain transaction data shows that there is a willingness to buy at 57,000; there is a willingness to sell at 62,000.
7. The probability of not falling below 54,000~57,000 in the short term is 70%; the probability of not rising below 64,000~67,000 in the short term is 74%.


• Market tone:
The overall market sentiment is neutral and sluggish, and the positive sentiment is low. At the same time, indicators show that the next fluctuation is also brewing. The overall expectation is basically the same as last week. The market may have limited rebound and is more inclined to range fluctuations.


Risk warning: The above are all market discussions and explorations, and do not have directional opinions on investment; please be cautious and prevent market black swan risks.


This article comes from a contribution and does not represent the views of BlockBeats.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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