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In the early morning of May 31, 2019, BTC staged the "Elevator Cry".
Summary
Summary
Topic: Starting at 23:40 on May 30, 2019, Beijing time, the price of BTC has been rising all the way, hitting a new high for the year, but then the "elevator horror" was staged. After only 15 minutes, the price of BTC was brought back below 8700 USDT, and the lowest touched 8010 USDT , just stopped the decline. We believe that the roller-coaster market for BTC this time may be mainly due to the following reasons: (1) early-stage sell-offs; (2) some investors took profits; (3) technical indicators diverged, and prices needed to be corrected. "Sky rises and falls" in the token market can be described as commonplace. If the 10% price limit of the stock market is used as the standard for measuring "surge and collapse", in the past 6 years, there have been 150 times when BTC's single-day rise and fall exceeded 10%, and the "surge" occurred once every half a month on average. Rise and fall." "Sky rises and falls" tend to appear concentrated at the end of a bull market and the beginning of a bear market. From the perspective of the first two rounds of BTC price cycles, at the end of the BTC price cycle, due to the fierce competition between the long and the short sides, the uncertainty of the future market has increased, so the price of the token is often within one trading day. produce larger amplitudes. It is not uncommon for BTC prices to fall sharply in a short period of time in a bull market. Since the start of this round of BTC price upward cycle, there have been 7 times when BTC prices closed down and fell by more than 8% within a day.
Market: Callback after record high, bull market logic remains unchanged. The total market value of digital tokens this week was US$272.7 billion, an increase of US$23.5 billion or about 9.4% compared to last week; the average daily trading volume was US$85.77 billion, an increase of 9.1% from last week, and the average daily turnover rate was 32.0% , down 0.1% from last week. The current price of BTC is 8574.5 US dollars, with a weekly increase of 7.4% and a monthly increase of 58.7%. The current price of ETH is 268.1 US dollars, with a weekly increase of 7.5% and a monthly increase of 66.7%. The BTC balance on exchanges this week was 800,000, an increase of 4.7 from last week. The balance of ETH on the exchange was 7.932 million, a decrease of 631,000 from last week. The BTC chips in the venue increased slightly, while the ETH chips decreased.
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Risk warning: regulatory policy risk, market trend risk
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1 Topic: BTC plummeted by more than 10%, is the end of the bull market?
1.1 BTC "Elevator Cry"
In the early morning of May 31, 2019, Beijing time, the BTC market staged an "elevator horror". Take the BTC price on the Huobi Global exchange as an example. Starting at 23:40 on May 30, the BTC price rose all the way. In less than half an hour, the BTC price rose from 8,730 USDT to 9,064 USDT, setting a new high for the year, but then the "elevator horror" was staged , Only 15 minutes later, the price of BTC fell back below 8,700 USDT. By 5:30 on the 31st, the price of BTC hit a minimum of 8,010 USDT, and the decline was just stopped.
1.2 Why the "slump"?
The short-term sharp drop of BTC has undoubtedly poured cold water on the recently extremely hot encryption market, so why did BTC "slump" this time? We believe that the roller coaster market of BTC may be mainly due to the following reasons:
(1) Selling of locked-up stocks in the early stage. In the downward market in 2018, many investors were deeply locked in between 8,000 and 9,000 US dollars. In May, the price of BTC rose sharply, with an increase of about 70%. violent fluctuations.
(2) Some investors took profits. After about 3 months of continuous rise, the price of BTC has reached a relatively high level in the short term. Some investors who entered the market earlier had a huge profit and began to take profits.
(3) The technical indicators deviate, and the price needs to be called back. Entering the second half of May, many indicators such as MACD and trading volume have shown divergence, indicating that the BTC price has a need for a correction.
1.3 The end of the bull market? Bull market 'slumps' are not uncommon
"Sky rises and falls" in the token market can be described as commonplace. Compared with the traditional financial market, there is no price limit on the secondary market of digital certificates, and the price fluctuation of the certificate itself is relatively high, resulting in "surges and falls" in the traditional market. If the 10% price limit of the stock market is used as the standard for measuring "surge and collapse", in the past 6 years, there have been 150 times when BTC's single-day rise and fall exceeded 10%, and the "surge" occurred once every half a month on average. Skyrocketing and plummeting”, of which there were 81 times the daily increase exceeded 10%, and there were 69 times the daily decline exceeded 10%.
"Sky rises and falls" tend to appear concentrated at the end of a bull market and the beginning of a bear market. From the perspective of the first two rounds of BTC price cycles, at the end of the BTC price cycle, due to the fierce competition between the long and the short sides, the uncertainty of the future market has increased, so the price of the token is often within one trading day. produce larger amplitudes.
It is not uncommon for BTC to either "crash" in a bull market or a "crash" in a bear market. Take the "slump" of the bull market as an example. In the bull market, when the price is close to the range accumulated by a large number of locked-up orders in the previous period or is adjusted due to major bad news and other reasons, there will often be concentrated selling, resulting in the appearance of a "slump" market. In the bull market, the "slump" is often quickly digested by a large number of buying orders that appear later, and the short-term decline does not affect the continued development of the bull market.
On May 30, 2019 UTC time, the maximum intraday drop (highest price/lowest price -1) of BTC was about 8.7%. The upward cycle is from November 2011 to November 2013, and the data in this article only includes May 2013 to November 2013), BTC prices closed down and the largest intraday drop exceeded 8% for a total of 23 times; the third round of bull market upward During the period (August 2015 to December 2017), there were 55 times when the price of BTC closed down and the largest intraday drop exceeded 8%.
It can be seen that it is not uncommon for BTC to fall sharply in a short period of time in a bull market. In the early stage of a bull market, the price of BTC may have a large downward adjustment due to various reasons, and the concentrated "surges and falls" even indicate to a certain extent that the market has entered the most extreme period. Crazy stage.
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2 Market: pullback after record high, bull market logic remains unchanged
2.1 The overall market: a slight increase
The total market value of digital tokens this week was US$272.7 billion, an increase of US$23.5 billion or about 9.4% compared to last week.
The average daily turnover of the digital token market was US$85.77 billion, an increase of 9.1% from last week, and the average daily turnover rate was 32.0%, a decrease of 0.1% from last week.
The BTC balance on exchanges this week was 800,000, an increase of 4.7 from last week. The balance of ETH on the exchange was 7.932 million, a decrease of 631,000 from last week. The BTC chips in the venue increased slightly, while the ETH chips decreased.
The market value of USDT is 3.14 billion US dollars, a decrease of 101 million US dollars from last week. The USDT premium rate remains basically unchanged.
2.2 Core Token: Overall Promotion
The current price of BTC is 8574.5 US dollars, with a weekly increase of 7.4% and a monthly increase of 58.7%. This week, the average daily trading volume of BTC was 25.6 billion US dollars, and the average daily turnover rate was 16.9%. The price of BTC rose this week, and the transaction volume increased slightly compared with last week.
The current price of ETH is 268.1 US dollars, with a weekly increase of 7.5% and a monthly increase of 66.7%. This week, the average daily trading volume of ETH was 10.82 billion US dollars, and the average daily turnover rate was 38.4%, which was a decrease from last week.
The current price of EOS is $8.51, with a weekly increase of 33.0% and a monthly decrease of 78.0%. This week, the average daily trading volume of EOS was 4.03 billion US dollars, and the average daily turnover rate was 57.1%. Affected by the good news, EOS changed hands significantly, and the increase this week was significantly higher than that of mainstream tokens.
The current price of BCH is $445.1, with a weekly increase of 8.8% and a monthly increase of 63.7%. The average daily trading volume of BCH this week was 2.37 billion US dollars, and the average daily turnover rate was 30.6%. BCH performed slightly better than BTC this week.
The monthly volatility of major tokens rose slightly this week. The monthly volatility of BTC was 25.2%, an increase of 0.7% from last week; the monthly volatility of ETH was 28.1%, a decrease of 0.3% from last week; the monthly volatility of EOS was 33.0%, An increase of 6.4% from last week; the monthly volatility of BCH is 33.4%, a decrease of 2.1% from last week. Overall market volatility rose slightly.
2.3 Market view: Callback does not change the logic of the bull market
BTC hits a new high and pulls back. This week, BTC continued to rise, breaking through the $9,000 mark at one point, and then saw a sharp correction after hitting a new high. This round of rising market may be coming to an end, and there is strong support around $8,000.
The callback does not change the logic of the bull market. Since the beginning of this month, digital tokens have continued to rise, and the bull market has gradually become clear. Although there has been a pullback in recent days, the general logic of the bull market will not change. Investors may consider increasing their positions appropriately if there is a pullback.
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3 Output and popularity: increasing computing power and mining difficulty
This week, according to GoogleTrends, the search popularity of the term Bitcoin is 14, which is lower than last week, and the search popularity of Ethereum is 10, which is unchanged from last week.
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4 Industry news: Japan's revised fund settlement law was approved, and WeChat's revised payment agreement came into effect
4.1 Japan's Revised Fund Settlement Law Approved
According to Nikkei news on May 31, Japan's revised "Fund Settlement Law" and "Revised Financial Instruments and Exchange Law" (which includes measures to strengthen the exchange and trading rules of encrypted tokens) were announced on March 31. It was approved at a plenary session of Japan's upper house on the morning of the 1st. The approved bill is expected to come into force in April 2020.
4.2 WeChat revised payment agreement takes effect
WeChat Pay has revised the "WeChat Payment Service Agreement", adding to Article 12.3: You are not allowed to directly or in disguise engage in Internet gambling, pornographic platforms, Internet lottery sales platforms, illegal foreign exchange, precious metal investment and trading platforms, illegal securities and futures trading platforms, tokens Issuance of financing and virtual token trading platforms, and illegal transactions such as asset management business and bulk commodity trading venues that have not obtained provincial government approval through the Internet without the approval of regulatory authorities, otherwise Tenpay has the right to terminate its payment settlement Serve. The revised agreement will take effect on May 31, 2019.
4.3 EOSIO Labs releases B1 wallet code for iOS and Chrome extensions
