This article is only a personal market opinion and does not constitute investment advice. Any trading based on this is at your own risk.

After a significant drop last weekend, there was a rebound at the beginning of this week, followed by a second test. Currently, the second test has already broken below the position mentioned in the last article, and more critically, it has broken below the support level that has held for nearly four months, making the short-term trend very unfriendly.

From the chart, BTC broke below the short-term support level of 109,500 yesterday, then broke below the upward trend line since April, and this afternoon it again broke below the support level since July (calculated based on daily closing, which is 108,000). The support level below is roughly around 100,000.

If it cannot recover during the evening trading hours in the U.S., the subsequent trend looks very pessimistic. Unfortunately, the U.S. stock market is also performing poorly, with S&P futures down over 1.3% during the day, while the VIX fear index has surged again by 12%, reaching 28+, a new high since May.

Combining the trends of the Chinese and U.S. stock markets, it seems the market is trading as if the trade war is real. However, I personally believe this is merely an endogenous adjustment demand within the market; valuations and profits are at short-term highs, which inherently creates a need for a pullback, and the news and opinions are just reasons found afterward.

The trend of ETH is also not optimistic, having broken below the key level of 3,870 mentioned in the last article this afternoon. If it continues to retest the previous low, it could form a head and shoulders pattern, which is very unfriendly.

I personally believe that it is better to be cautious until BTC returns above 108,000.

Follow me to maximize trend profits with minimal operations.

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