"Jiangfeng Trading Diary" Issue 12: K-line and indicators are merely results of price, not the reasons for price!
Bitcoin recently surged to around 66924 before starting a retracement, accurately adding a high short position near 66900 from Issue 10. Now, after retracing to around 64636, it has started to rebound. Is this a trap for bullish optimism or a buildup for bulls waiting to strike?
First, the conclusion: price wants to break upward, but the macro environment does not support it. All current rebounds are considered as traps for bullish optimism, so one must be cautious when chasing long positions. The best strategy is to short during the rebound!
▶️ Ethereum current price 1885 short directly, add short around 1910-1935-1967
🏁 Target 1830～1800
🏁 Target 1760～1730⛳️ Reduce positions by 70%
🏁 1680～1550
▶️ Bitcoin current price 65450 short directly, add short around 66300～66900
🏁 Target 64000～62800
🏁 Target 62000～61300
🏁 Target 60000～59000
Next, let's discuss a few major bearish factors recently to assist in judgment:
September interest rate hike expectations - 82% probability, the market is re-pricing
CME data shows that the probability of the Federal Reserve maintaining the interest rate in July is 66.3%, while the probability of a rate hike is 33.7%. But what's worth noting is September, where the probability of maintaining the rate is only 18.6%, while the cumulative probability of a 25 basis point hike is as high as 57.2%, and the probability of a 50 basis point hike is 24.2%. Federal funds futures indicate that the probability of a rate hike in September has risen to about 82%.
What does this mean? The market has shifted from the narrative of "the end of rate hikes" to "the restart of rate hikes." Should the Federal Reserve meeting on July 29 release any hawkish signals, this probability will continue to rise.
10-Year U.S. Treasury Yield Breaks 4.71% - The Anchor of Global Asset Pricing Roars
The 10-year U.S. Treasury yield briefly rose by 4 basis points to 4.71%, the highest since January 2025. The higher the risk-free rate, the lower the attractiveness of Bitcoin, which is a non-yielding asset!
Brent Crude Oil Breaks $100 Intraday - Fuel for Inflation
Brent crude futures briefly surged above $100, with rising oil prices pushing inflation, and this transmission chain pushing expectations for rate hikes has clearly been established.
Another point worth noting is the daily net outflow of Bitcoin spot ETF of $225 million - ending a seven-day inflow streak
Yesterday, there was a total net outflow of $225 million from the Bitcoin spot ETF, officially ending the previous seven consecutive days of net inflow. Among them, BlackRock's IBIT had a daily outflow of up to $202 million.
Funds are fleeing. And they are fleeing very quickly.
From the market, we can clearly see that both Bitcoin and Ethereum prices have now fallen below their trendlines, with significant resistance above. I truly can't find any reason to go long. Considering the aforementioned points, I personally believe that any rebound is a good opportunity to enter short positions! However, it is important to trade with light positions to speculate, and one must not blindly operate with heavy positions. The fundamentals are subject to fluctuations at any time, and there are numerous uncertain factors, so please do not undertake blind heavy position operations!
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