BTC is going higher than expected, and that's a reality. But this is not going to go "up only" forever. I prefer to wait until I see strong reasons to be exposed to the market for the long-term, and not just because the price is going up. That would be FOMO. I'm not losing any money (because I haven't shorted alts for months and never shorted BTC, despite what people say), nor am I missing out on opportunities, because there are always opportunities. I'm just being cautious, waiting. Not following the masses and trying to be rational.

After a run from 16k to 60k without any major correction which in my opinion has been caused mostly by ETF + halving FOMO and stablecoin mints and liquidity gaps formed during the bear market, everyone seems to be bullish and expecting ATH, 100k or even higher... ruling out any kind of major correction and just aiming higher and higher. That's greed and euphoria. Also it seems like everyone caught the absolute bottom and rode the trend until now. Those who really did, congratulations. But the majority just held during the entire bear market until now.

It seems I'm the last bear standing.

To give you an idea of how overleveraged the market is. It's not common to see these extreme levels of greed.

We need a 20-30% shakeout to reset fundings and sentiment.

Here you see how during the move up from 25k to 40k-50k, there was some demand supporting the move. However, during the last move up from 50k to 64k, there wasn't any demand. Also big hand were filling asks (unloading supply) all the time, especially between 40k and 64k.

Now we can see massive liquidity gap all the way down to 30k levels. Many inefficiencies were also formed. The price moves looking for liquidity, no matter in which direction. Most of the liquidity is below.

Are rate cuts a bullish or rather a bearish event?


Throughout history, we have seen how when interest rates have been paused, the markets have entered a distribution phase or the final phase of the bullish rally. Once the Fed start cutting interest rates, the market often drops. But why?

High interest rates for an extended period are bad for the economy. Central banks intentionally maintain high interest rates in a phase known as QT (Quantitative Tightening), as a measure to slow down economic activity and control inflation. They achieve their goal, as inflation drops, but it has serious collateral effects, such as a possible recession. Some countries like the UK and Japan have already announced they are in recession. It's likely that other countries will also confirm this, and the markets return to their fair price.

BTC is going higher than expected, and that's a reality. But this is not going to go "up only" forever. I prefer to wait until I see strong reasons to be exposed to the market for the long-term, and not just because the price is going up. That would be FOMO. I'm not losing any money (because I haven't shorted alts for months and never shorted BTC, despite what people say), nor am I missing out on opportunities, because there are always opportunities. I'm just being cautious, waiting. Not following the masses and trying to be rational.

After a run from 16k to 60k without any major correction which in my opinion has been caused mostly by ETF + halving FOMO and stablecoin mints and liquidity gaps formed during the bear market, everyone seems to be bullish and expecting ATH, 100k or even higher... ruling out any kind of major correction and just aiming higher and higher. That's greed and euphoria. Also it seems like everyone caught the absolute bottom and rode the trend until now. Those who really did, congratulations. But the majority just held during the entire bear market until now.

It seems I'm the last bear standing.

Whether Bitcoin reaches its all-time high or not, I still think that now is probably one of the worst times to be bullish. The time to be bullish was some months ago. Now the trend is overly extended, indicators peaking, and the movement doesn't really match the global economic situation. There are many factors why I think it's a time to be cautious, and I will post them this week in a new Twitter thread.

With that said, some low caps might still have room to pump, but they are also overextended now. I will share several setups if we see a shakeout first to clear leverage from the market. This potential move would be a drop of about 25-30%, maybe a bit more depending on the liquidations that could occur.

Good night.

Good morning.

Yesterday we saw a very strong reaction from major resistance levels. BTC took the ATH, some altcoins were at important resistances (DOT, SOL...) and fundings were extremely high. However, price didn't break 60k, which is the first bearish confirmation.

Now we are seeing a strong bounce as well, but into the same resistance levels. Fundings didn't fully reset. Sentiment is back to bullish. And judging by the heatmaps and some indicators, this bounce could be a DCB.

In my opinion yesterday's dump was the test dump.

Why I think the inflows into the BTC spot ETF are not as bullish as many think. Here's my opinion on them:

First of all, what is a BTC spot ETF? A Bitcoin spot ETF (Exchange-Traded Fund) is a type of investment fund that is traded on stock exchanges, similar to stocks. The primary characteristic of a Bitcoin spot ETF is that its underlying asset is Bitcoin itself, rather than derivatives or futures contracts of Bitcoin.

The fund managers are the ones who offer these products. Some of them are BlackRock, Grayscale, Fidelity, Bitwise...

Many people talk about BTC inflows being bullish. To what extent? On one hand, it's capital that was going to enter BTC, whether through the ETFs or from some exchange or OTC purchase. On the other hand, these inflows are capital entering the ETF, not necessarily an increase in the fund's reserves.

When there are ETF inflows, it means that investors are putting more money into the ETF, buying shares of the fund. This increase in capital can lead to the fund manager purchasing more of the underlying assets (BTC) to match the fund's investment strategy. But if those assets were already bought, then the inflows are not direct demand as such.

The main question here is… are the fund managers holding BTC for themselves? Or just for the fund?

The institutional money that wanted to enter BTC has already done so a long time ago. We don't know if it's institutions that are buying BTC through ETFs, or if it's retail investors attracted by this possibility. What we do know is that BlackRock, Fidelity... have not disclosed whether they hold BTC for themselves. Nor has there been talk of any major institution entering the market, beyond offering a product (the ETFs). Remember that the news were about the product, and they did marketing for that. Not for the asset itself and its characteristics (what Bitcoin and crypto really implies)

In the end, the fund managers act like an exchange, keeping the fees for the volume generated in their fund. If they thought it was a market moment where there could be a large volume, then it was the best time to launch the ETF. But it's important to remember that ETFs can also be shorted, and the managers don't care whether these fees are generated when the price goes up or down. So they essentially act as an amplifier of an asset's movements and its volume.

To summarize, ETFs have some advantages such as providing more visibility to the asset and offering more options for capital inflow into the market. However, on the flip side, they also have disadvantages, such as diverting demand towards a fund's share rather than being direct demand for Bitcoin, it can lead to speculation about whether it's really as bullish an event as we have been led to believe, and it makes the asset more centralized, moving it away from its main goal of decentralization.

Some food for thought.

OTHERS (Altcoin index)

I'm still working on the new part of the Twitter thread on why I think it's not a good time to be bullish and why we should expect a larger correction, adding more solid arguments to the previous one. It should be ready for next week.

I wish you all a good weekend!

In moments like this, it's most important to keep a cool head and remind oneself that even though the market can be irrational at times, that doesn't mean you should stop being rational at all times.

As I mentioned before:

The market is going higher than expected, and that's a reality. But this is not going to go "up only" forever. I prefer to wait until I see strong reasons to be exposed to the market for the long-term, and not just because the price is going up. That would be FOMO. I'm not losing any money (because I haven't shorted alts for months and never shorted BTC, despite what people say), nor am I missing out on opportunities, because there are always opportunities. I'm just being cautious, waiting. Not following the masses and trying to be rational, even if it's hard.

The chart posted only shows how overextended Bitcoin is, but it's like that with the entire market.