Bullish analysts have liquidated their positions. Should retail investors cut their losses or buy at the bottom?

Entering the halving week, coupled with the influence of war factors, the entire crypto market is extremely weak. As of writing, the price of Bitcoin fell below $63,000, a 24-hour drop of 3.5%. In addition, the US Bitcoin spot ETF had a net outflow of $37 million yesterday. At the same time, the performance of altcoins has not improved in the new week, with the total market value of cryptocurrencies at $2.43 trillion and a 24-hour drop of 2.11%.

According to Alternative data, today's cryptocurrency panic and greed index is 62 (yesterday's was 74), a new low in nearly a month, and hype continues to cool down. According to Etherscan data, the Ethereum network gas fee has dropped to 8 gwei this morning. Various data show that the current crypto market has entered a cooling-off period. Against this background, multiple analysis agencies have also given their own operations.

Markus Thielen, founder of crypto analysis agency 10X Research, said on April 8 that "Bitcoin may climb above $80,000 or even higher in the coming weeks. It seems appropriate to buy at $69,280 and set a stop loss at $65,000."

But today, he said on the social platform that risky assets represented by stocks and cryptocurrencies are on the verge of a major price adjustment. The main cause is unexpected and persistent inflation. The bond market currently expects less than three interest rate cuts and 10-year Treasury yields to exceed 4.50%. The market may have reached a critical tipping point for risky assets. Therefore, 10X Research has now cleared all positions.

Crypto market maker QCP Capital also pointed out in its latest market report that the ETH risk reversal indicator has turned extremely negative (-12%) at the near end, indicating that market risk aversion is heating up. In addition, the market is currently in a short position of ETH Gamma, which means that the sharp fluctuations in the price of Ethereum may be amplified.

However, some people are pessimistic and some are optimistic. Although the price of Bitcoin has not been strong, the bull market of the Bitcoin ecosystem has arrived as expected. In the past few days, a mint list has been circulated in the community, including projects that need to be charged at night, and the mood is very high.

Related reading: "After five months of "cooling off period", we finally entered the third wave of Bitcoin ecology"

As for altcoin trading, the entire market has experienced a lot of craziness since 2024. New value coins compete with meme coins, and the old value coins "have been in a slump", which makes people shout that value investment is a waste. However, in the eyes of some crypto veterans, it is now in the bottom range of trading. As shown in the figure below, the altcoin trading signal shows that it is now time to "Sell your house".

Chris Burniske, former head of Ark Invest encryption and current partner of Placeholder VC, said on social media that "there is obvious fear in the market, and prices have gained a foothold within a reasonable range, and excessive prices have been washed away, which is a preparation for the final rise." Chris has also said before that if tensions between Israel and Iran are eased (to be determined), the leverage reset of cryptocurrencies and the selling of non-firm holders will be a good start for the market to enter the Bitcoin halving period.

A week ago, Arthur Hayes also wrote in a blog post that the US taxation from mid-April to early May will drain market liquidity, and the Fed's continued balance sheet reduction may cause the market to be extremely weak. However, starting from May 1, as the Fed slows down the pace of balance sheet reduction and the US Treasury uses funds to stimulate the market, a new round of crypto bull market is expected to start.

Related reading: "Arthur Hayes: The real crypto bull market will start in May"

For traders, all they can do now is wait patiently.

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