Asia's High-Speed Highway Opens, Airborne Danger!
The first batch of Bitcoin spot ETF and Ethereum spot ETF in Hong Kong is scheduled to be issued on April 29 and listed on the Hong Kong Stock Exchange on April 30. This marks the first batch of Bitcoin spot ETF in Asia and the world's first batch of Ethereum spot ETF. Hong Kong retail investors can purchase after passing a cryptocurrency knowledge test. Mainland residents with Hong Kong brokerage accounts can also purchase Bitcoin/Ethereum ETFs, and these funds may be included in the mutual market access program for use by mainland investors with mainland brokerage accounts.
The Bitcoin spot ETF and Ethereum spot ETF in Hong Kong have pioneered a mechanism for physical subscription and redemption, allowing investors to directly use Bitcoin and Ethereum to subscribe to and redeem corresponding ETF shares. This innovative mechanism of purchasing ETFs directly with the respective cryptocurrencies provides a new way to invest in asset classes, not only lowering the entry threshold but also enhancing investment flexibility and market transparency through the option of physical subscription and redemption. It is expected to further promote the development of the virtual asset market in Hong Kong and even the entire Asia, attracting more global capital inflow.
Meanwhile, a Bitcoin ETF in South Korea is also in the works. According to the data from the research firm Kaiko, in the first quarter of 2024, the cumulative trading volume of the Korean won on centralized cryptocurrency exchanges was $456 billion, while the trading volume in US dollars was $445 billion. Korean investors tend to prefer tokens with smaller market capitalization and usually higher volatility, known as "altcoins," rather than larger cryptocurrencies such as Bitcoin and Ethereum. On average, trading involving smaller tokens accounts for over 80% of all trading activity in Korea.
During the election campaign, the Democratic Party of Korea made various commitments to revitalize the digital asset market. Most importantly, the party focuses on stimulating the virtual asset market by listing Bitcoin ETFs and reducing the tax burden on individual investors in cryptocurrency investments. This means that individual investors can invest in virtual assets in a more favorable environment. The main commitments of the Democratic Party of Korea focus on promoting the listing of Bitcoin spot ETFs, reducing the tax burden on individual investors in cryptocurrency investments, institutionalizing the cryptocurrency market, and strengthening investor protection.
Transformation of Strength and Weakness, Rise in May!
Setting aside the chaotic news, if we only look at the market, the "big cake" has formed a consolidation center on the daily chart, and it has likely completed about two-thirds of the process. Its characteristic is to repeatedly use greed and panic emotions within the range, oscillating up and down, cleaning up chips, raising the average cost, and clearing out the unsteady long positions. On the monthly chart of a larger time frame, the upward trend remains strong, with no signs of any top reversal. The April candle is completely contained within the March candle, which is commonly referred to as a "pregnant line" in technical analysis, meaning consolidation and incubation.
In the shorter time frame, we can observe the details of the internal structure more clearly. On April 19, the market exchanged a large number of chips due to the conflict between Israel and Iran, and quickly surged in a short period of time. On that day, many traders sold the chips they bought around 70,000 to smart money. If it were you, it would be difficult to abandon the "big cake" picked up below 63,000.
Furthermore, it is clear to see that the downward intensity since April 8 is gradually weakening, and various indicators such as trading volume, slope, magnitude, time, and indicators all clearly reflect this objective fact. The strong downward movement is turning into a weak one, so the next step will be the weak rebound turning into a strong rebound, and the weak uptrend transforming into a strong uptrend. This is a natural law.
The current price is at a relatively low level within the daily consolidation range, meaning there is limited downside space. At this time, long positions have a higher risk-reward ratio, so even if the upward breakthrough fails, the bulls can still exit with a profit. The market is like an actuary, always coordinating the candlesticks with the world, exchanging time for space, or space for time. The only factor hindering the price breakthrough now is time, but time does not stop, and the countdown to the breakthrough will not stop. Time is running out for the bears.
When Others Fear, I am Greedy; When Others are Greedy, I am Fearful
Recently, the risk asset markets represented by the United States and Japan have shown a common characteristic: a significant retracement after breaking historical highs. This situation has been frequently observed in the trends of various markets and assets since 2020, such as the NASDAQ index, Nikkei 225, and cryptocurrencies. After the retracement, there is also a common characteristic of a rapid rebound and a new high.
This is actually a very clear method of shaking out weak hands. The reason it is called shaking out rather than exiting is that in such a short period of time, the main players cannot achieve their selling targets. Real selling occurs during a long-term consolidation at high levels, providing opportunities for investors to buy. Such a rapid and urgent decline undoubtedly aims to create panic and prompt investors to sell stocks at low prices to the main players. The rapid rise after the adjustment is to quickly raise the cost, making it difficult for investors to enter, and because most retail investors no longer have many chips, there is no selling pressure, making the rise effortless. Trading is counterintuitive; when the public is in a state of panic, it is the time for a rebound. When others are fearful, we should be greedy. Why not dare to add positions when encountering low-priced and high-quality assets? The market will not only decline or rise, and only those who can overcome emotions can ultimately profit in the market.
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