On-chain data for the 24th week: Inflation may have reached a turning point, wait patiently for market repair and adjustment

Original title: "Entering a rest period, the market enters a new pace | WTR 6.17"

Original source: WTR Research Institute

Review of this week

From June 10 to June 17 this week, the highest price of Bingtang Orange was around $70195 and the lowest price was close to $65078, with a fluctuation range of about 7.29%.
Observing the chip distribution map, there are a large number of chips traded around 66000, which will have a certain support or pressure.

• Analysis:
1. 59000-63000 is about 870,000 pieces;
2. 64000-68000 is about 1.4 million pieces;
• The probability of not falling below 57000~61000 in the short term is 90%;
• The probability of not rising above 71000～74000 in the short term is 67%.

Important news

Economic news

1. The annual rate of PPI in the United States in May was 2.2%, lower than the expected value of 2.5%, and the same as the previous value of 2.2%;
2. The monthly rate of PPI in May was -0.2%, lower than the expected value of 0.10% and lower than the previous value of 0.50%.
3. The number of initial jobless claims in the United States was 242,000, higher than the expected value of 225,000 and higher than the previous value of 229,000.
4. ANZ Bank said that the US dollar will weaken in the coming months because the Federal Reserve may implement two interest rate cuts in 2024.
5. On June 13, the Fed's interest rate meeting dot plot showed that the expectation of interest rate cuts this year was cut from 3 times to 1 time, and the number of interest rates next year was raised from 3 times to 4 times;
6. Among the 19 members, 4 members believed that interest rates should not be cut in 2024, 7 members believed that interest rates would be cut once, and 8 members believed that interest rates would be cut twice.
7. Powell said: "The first interest rate cut has an impact on the economy. What is important is the entire interest rate path, not just the first interest rate cut. Once inflation is controlled, interest rates can be lowered; ultimately, we believe that interest rates will need to fall to continue to support the target."
8. As the Federal Reserve expressed that it would not rush to relax monetary policy, the U.S. money market fund had a weekly flow of about $28 billion, and its scale rose to a record $6.12 trillion.
9. The Jackson Hole Central Bank Annual Meeting was held in August. Federal Reserve executives have always used speeches at this forum to indicate major changes in the Federal Reserve's plans or ideas.

Crypto Ecological News

1. Gensler said: It expects the S1 application for the spot ETH ETF to be approved sometime in the summer.
2. At the U.S. budget hearing on Thursday, when Gary Gensler, director of the U.S. Securities and Exchange Commission (SEC), was directly asked whether ETH is a commodity, Gensler did not answer yes or no, but insisted on the agency's uncertain position on the asset;
3. When Rostin Behnam, director of the Commodity Futures Trading Commission (CFTC), was asked whether ETH is a commodity, he replied: "Yes."
4. JPMorgan Chase said in a research report that the net inflow of digital assets has reached US$12 billion so far this year. If funds continue at the same pace, this figure may grow to US$26 billion by the end of the year. The bank believes that the exchange's digital wallets may shift significantly to the new spot BTC ETF.

Long-term insight: used to observe our long-term situation; bull market/bear market/structural change/neutral state
Mid-term exploration: used to analyze what stage we are currently in, how long will this stage last, and what situation we will face
Short-term observation: used to analyze short-term market conditions; and the possibility of some directions and certain events occurring under certain conditions

Long-term insight

• On-chain chip destruction and addition
• US crypto ETF net position
• Total spot selling pressure
• Total spot selling pressure

(Figure below: On-chain chip destruction and addition)

The on-chain chips show that the new power has begun to decline, and of course the destruction and selling have also begun to decline. The market may enter a blank period during this period.

（U.S. Crypto ETF Net Position in the Figure Below）

ETFs are relatively sluggish. At present, it may take some time for OTC funds to be integrated.

They are not particularly active in the influx.

（Non-liquidity whales in the figure below）

Non-liquidity whales are still buying.

（Total spot selling pressure in the figure below）

Total spot selling pressure shows that the selling pressure has temporarily returned to a relative low point this year. Of course, it is not the lowest point yet.
It is expected that the main power of funds in the future will come from the market. The funds in the market will continue to buy, and then the selling pressure will slowly decrease, returning to a moment of squeezing and then upward.
If conditions permit, you can do a low-long strategy.

Mid-term exploration

• Liquidity supply
• Accumulation trend score
• ETH exchange circulation ratio
• Network sentiment positivity

(Figure below: Liquidity supply)

Yellow line: Liquidity supply amount
Blue area: Liquidity supply change rate

BTC's liquidity supply determines the new buyer sentiment in the market, and is currently in a state of slowing growth. It may still take some time to repair the state of liquidity supply.
In previous changes, usually, the market will get out of a better state under the condition of ensuring sufficient liquidity supply.

(Figure below: Accumulation trend score)

Only addresses>10k in the market still maintain good accumulation, and the overall enthusiasm is not high.
It is possible that the current accumulation time should be longer to make room for subsequent growth.

(The following figure shows the circulation ratio of ETH exchanges)

The circulation ratio of ETH in exchanges has decreased, and the market has been converted into a relatively safe-haven structure with more BTC circulation.
It is possible that the holding time needs to be increased to replace more space.

(The following figure shows the positivity of network sentiment)

Network sentiment has entered a negative value, and the overall sentiment is in a stage of decline and adjustment.
It is possible that the adjustment time will be prolonged if the network sentiment is not corrected.

Short-term observation

• Derivatives risk factor
• Option intention transaction ratio
• Derivatives trading volume
• Option implied volatility
• Profit and loss transfer volume
• New addresses and active addresses
• Bingtangcheng Exchange net position
• Yitai Exchange net position
• High-weight selling pressure
• Global purchasing power status
• Stablecoin exchange net position
• Off-chain exchange data

Derivatives rating: The risk factor is in the neutral area. Derivatives risk is moderate.

(Figure below: Derivatives risk factor)

Consistent with last week's expectations, ETH showed a shock adjustment. Last week, the risk factor was in the green area and is now in the neutral area. But from the perspective of the risk factor, the market may continue to shock and adjust this week.

（Figure below: Option intention transaction ratio）

Option transaction volume has slightly decreased, and the proportion of put options is at a low level.

（Figure below: Derivative transaction volume）

Derivative transaction volume is at a low level.

（Figure below: Option implied volatility）

Implied volatility has slightly decreased.
Sentiment rating: neutral

（Figure below: Profit and loss transfer volume）

The current market situation is basically the same as last week.
The short-term holder cost line is around 63K, and the continuous market volatility also shows that panic sentiment (orange line) is difficult to continue to rise at the current price without external black swan conditions, causing a huge market decline.
Currently, both positive sentiment (blue line) and panic sentiment (orange line) are at a low level.

（Newly added addresses and active addresses in the figure below）

Newly added and active addresses are at a low level.
Spot and selling pressure structure rating: Overall, there is a large amount of outflow accumulation, and the selling pressure in the market is low.

（Net position of Bingtangcheng Exchange in the figure below）

The net position of BTC exchange is in a state of large outflow accumulation.

（E-Exchange Net Position in the Figure Below）

ETH Exchange Net Position is in a state of large outflow accumulation.

（High Weight Selling Pressure in the Figure Below）

No high weight selling pressure.
Purchasing Power Rating: Global purchasing power is in an outflow state, and stablecoin purchasing power is flat.

（Global Purchasing Power Status in the Figure Below）

Currently, the purchasing power of the three continents of America, Asia and Europe is in an outflow state. This week, we intercept the purchasing power of the Americas with a higher weight for observation. When the purchasing power of the Americas is in a state of loss, the market price is in a volatile trend and is very likely to reach the cost line of short-term holders.

（USDT exchange net position in the figure below）

USDT exchange net position is flat.
Off-chain transaction data rating: willing to buy at 65,000; willing to sell at 70,000.

（Coinbase off-chain data in the figure below）

Willing to buy at prices around 64,000 and 65,000;
Willing to sell at prices around 70,000, 71,000, 72,000, and 73,000.

（Binance off-chain data in the figure below）

There is a willingness to buy at around 65,000;
There is a willingness to sell at around 70,000, 71,000, 72,000, and 73,000.

（Bitfinex off-chain data in the figure below）

There is a willingness to buy at around 65,000;
There is a willingness to sell at around 70,000, 71,000, 72,000, and 73,000.

Summary of this week:

Summary of news:

1. Powell also said that the latest CPI data was encouraging, and hinted that the latest CPl data may not be fully reflected in the latest forecasts of monetary policy makers.

2. This week's Federal Reserve interest rate meeting did not play a role in loosening the gates, and conservatively stated that it would not rush to relax monetary policy. The size of US money market funds reached a record high of US$6.12 trillion from US$6.09 trillion a week ago.

3. The traditional money market continues to accumulate, and has not flowed to riskier products. Many people are concerned about when this part of the funds will flow to risky assets, including stocks, gold and pie, which is also the bull market that many people look forward to.

4. The monetary policy led by the Federal Reserve has changed from tightening to easing. Tightening began in early 2022, and easing may begin in the second half of 2024.

5. Currently, the market is focusing on whether the rate will be cut once or twice this year. If it is twice, the rate will be cut in September, and the market may speculate in advance in August. If it is in October, it may be speculated from September to October.

6. The CPI data in the next two months will be the key, and inflation has most likely reached a turning point.

7. The inflation data in the next two months is particularly important, which determines whether the market rhythm will be early or late.

Long-term insights on the chain:

1. The increase in new chips on the chain has dropped significantly;
2. The net position of crypto ETFs shows an increase in net outflows, and the off-site funds are relatively sluggish;
3. Illiquid whales are still buying;
4. Spot selling pressure returns to the low stage this year.

• Market tone:
Entering the slow repair accumulation stage, the relatively short low-long strategy is more effective.

Medium-term exploration on the chain:

1. The liquidity on the market has slowed down and it takes time to wait;
2. Currently, only 10k addresses have a certain accumulation;
3. The market tends to be a safe-haven structure with more BTC circulation;
4. Network sentiment is in the adjustment stage.

• Market tone:
Adjustment
The market is in the stage of repair and adjustment, and more patience may be needed.

On-chain short-term observation:

1. The risk factor is in the neutral area, and the risk is moderate.
2. The number of newly added active addresses is relatively low.
3. Market sentiment rating: neutral.
4. The net position of the exchange as a whole shows a large amount of accumulated outflow, and the selling pressure is low.
5. The global purchasing power is in an outflow state as a whole, and the purchasing power of stablecoins is flat.
6. Off-chain transaction data shows that there is a willingness to buy at the price of 65,000; there is a willingness to sell at the price of 70,000.
7. The probability of not falling below 57,000~61,000 in the short term is 90%; among them, the probability of not rising above 71,000~74,000 in the short term is 67%.

• Market tone:
Market sentiment is still in a neutral zone, and there is no panic. The current short-term holder cost line is still around 63K, and the market purchasing power has been greatly lost.
It is expected that the price will continue to fluctuate or fall back to the price near the short-term holder cost line.

Risk warning:
The above are all market discussions and explorations, and do not have directional opinions on investment; please be cautious and prevent market black swan risks.

This article comes from a contribution and does not represent the views of BlockBeats.

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