Recently, there has been a flood disaster in my hometown. I went home and spent a few days dealing with it. Now I finally have the time to sit down, check the market, and chat a bit (Part One).

Our market seems like a free fall ride, suddenly lifting me up and then dropping me rapidly. You brought me madness, and it's hard to breathe after surviving the ordeal... The lyrics of the free fall ride have been briefly summarized; the market is basically in this situation: BTC is consolidating at a high level, ETH is fluctuating wildly, and altcoins continue to decline. The uneasy emotions in the market are becoming more intense.

Have you experienced this situation? During the same time last month, the market sentiment was also in this atmosphere, with the bears still firmly pessimistic and the bulls remaining silent and self-doubting. Everyone knows the script that follows: after accumulating fuel, the market chooses to go up with a double explosion of longs and shorts, breaking through historical highs to lure in more buyers, then begins to pull back, harvesting the chips of the bears, and then turns back up, harvesting back and forth.

This stage is indeed difficult to endure, with both short and long positions appearing so easy to manipulate. You might say it is the news of the war that causes this, but I believe it is more about artificial control. The current market clearly lacks liquidity, and U has a premium, especially after the significant pullback on the 17th, which did not even allow the price of U to rise, indirectly proving that retail investors have no intention of replenishing their positions or buying.

To be honest, no one can predict the market trend with absolute clarity and accuracy. Currently, there are actually very few retail investors trading BTC, and when the price drops, it's basically institutional investors making up for it. However, the prices of major cryptocurrencies have fallen without any rebound, which can only indicate that at the moment, most retail investors have chosen to wait and see. Everyone believes that BTC is influenced by external factors and will experience an even greater decline; even if there is a desire to average down, they do not plan to enter the market now.

Many experienced old investors say that this is obviously not a good phenomenon. Once large holders of altcoins can't bear the torment of the market and cash out at this price, with such low market demand, the order book will definitely not be able to handle it, leading to a sharp drop reflected by a large bearish candlestick. If panic selling occurs, the indicators on the candlestick chart will look even worse.

But personally, I think these situations should be what the big players hope for the most. They don't have to do anything and can harvest a significant portion of low-priced chips. If necessary, they can continue to pump and dump to create fluctuations. If some stocks are light, they can directly cooperate to push up and sell at a high position. Currently, this price range still has a relatively low cost for them. Therefore, I am quite optimistic about the current trend and maintain my original judgment that after the fluctuations, there should still be a possibility of continuing to break new highs. I adjusted some positions a while ago, and after stopping losses, I also have some cash, so I can be well-prepared for both scenarios.

Of course, the wealth effect in this round of the cryptocurrency market has decreased significantly. The above views are limited to certain cryptocurrencies that may have speculative value in the future. Many whales and large holders ranked outside the top 200 in market cap have long since fled, leaving a mess behind. You may just be unaware and naively hope for a rate cut by the end of this year to drive another wave. To be honest, the current market depth is very shallow, with most transactions being institutions flipping assets back and forth. Apart from super large coins like BTC and ETH, other altcoins are basically playing data games with you, relying on information asymmetry and psychological tactics. In previous updates, I've consistently suggested that everyone try to think about the market from the perspective of whales and market makers, especially for those trading short-term. If you can glean some insights from the order book data, the segment returns for large coins during this time have actually been relatively optimistic. However, only relatively experienced advanced players can master these skills.

Are advanced players really more likely to make money? At the beginning of 2024, a friend of mine in the catering industry shared his trading strategy for 2024 with me. He said it was the essence he learned by spending a lot of money to attend a course. In summary, it was: consistently use low leverage to long BTC and high leverage to short altcoins. That said, when I first heard this strategy, I felt it was well summarized. Looking back, this strategy was effective throughout 2024 and even into 2025. However, after November 2024, he stopped contacting me. A few days ago, I found him and learned that he had made money at first but then took big risks, opening positions every day and simultaneously operating several cryptocurrencies. In the end, he was still holding onto a position that blew up, accumulating losses of over 1.2 million, more than three times the initial capital of 350,000.

This story once again validates that even if part-time traders have the best strategies and insights, as long as they are overconfident and keep staring at market trends for too long, they will ultimately be no match for the market and human nature.

There are the most people of this kind in the market.

( to be continued )