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On-chain data analysis for the 40th week: the current risk aversion sentiment is heavy, and the market has entered the lowest stage of downturn

WatchToweR Crypto

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Off-chain data has purchasing power around $18,000.

Original title: "Wind and rain, how can I choose a tree｜WTR 10.3"

Original author: WatchToweR Research Institute

This Week Review

This During the week from September 26 to October 2, the highest BTC was around 20360, and the lowest was close to 18500, with a volatility of around 9.93%.

Observing the recent chip distribution chart, a large number of chips were traded around 19200, and there will be certain support or pressure.

Analysis:

1.20500~21200 about 660,000 pieces

2.26770~33000 about 830,000 pieces

The probability of not breaking through 26770~33000 is 69%.

Important news

Economic news

United States

1. The number of people applying for unemployment benefits for the first time fell to a five-month low last week.

2. The U.S. dollar index broke through 114 this week, hitting a new high since 2002.

3. According to data from the Ministry of Commerce on Friday, the PCE price index in the United States in August increased by 6.3% year-on-year, which was higher than expected, and the core PCE price index unexpectedly accelerated upward, increasing by 4.9% year-on-year.

4. According to data from the Ministry of Commerce on Thursday, the final value of GDP growth in the second quarter of the United States was -0.6%, the revised final value shrank for the second consecutive quarter, and the economy fell into a technical recession.

5. Bank of America believes that the New York Stock Exchange Composite Index (including US stocks, depositary receipts and real estate investment trusts, etc.) has fallen below several key technical support levels, and the market may experience panic selling.

Britain

1. This week the Bank of England announced that it will Temporary purchases of UK long-term gilts on any scale necessary to restore order to the UK bond market.

a. On Wednesday, it bought 1.025 billion pounds of long-term bonds with a maturity of more than 20 years, and another 1.415 billion pounds on Thursday, and said it would buy about 65 billion pounds of long-term government bonds.

2. After the fiscal stimulus was announced last week, the UK's deficit rate will rise to around 3-4% in the next two years, and government bond issuance is expected to increase by 44% this year.

3. British pension funds are currently under the pressure of margin calls and have to sell their holdings of stocks and bonds to raise cash. Even high-quality investment-grade bonds have been sold. Falling further, forming a vicious circle.

a. BlackRock proposed on Wednesday that its debt-driven investment strategy fund will be liquidated directly if the collateral is exhausted. This move is considered to have failed to protect pension funds, but to avoid default A blow to its reputation.

4. Investors expect the Bank of England to raise interest rates to 6% next year, which is more than twice the current benchmark interest rate of 2.25%. The repayment pressure and default risk of mortgage loans and their refinancing may surge.

a. Credit Suisse predicts that soaring interest rates will lead to a decline in purchasing power and mortgage affordability, and house prices may fall by 10%-15% in the next year to 18 months.

5. On Tuesday, the British market canceled 935 mortgage products, a record high scale, and another 321 similar products were withdrawn on Wednesday, from last Friday to this Thursday, a total of 1621 Residential mortgage mortgage products disappeared from the market.

1. German inflation rate for the first time in 70 years In a worst-case scenario, Germany's economy could shrink by 7.9% next year.

2. According to preliminary estimates by the Statistics Office, German consumer prices rose by 10.9% in the year to September, faster than the 8.8% increase in August, which was a new high in two decades.

3. The reconciled CPI in the euro zone rose by 10% year-on-year in September, reaching double digits for the first time.

4. The European Union announced the proposal for the eighth round of sanctions against Russia, and the European Union will set a ceiling on Russian oil prices.

5. The European Union has passed energy programs to subsidize households and businesses from rising energy.

6. The "North Stream" pipeline was damaged this week. Currently, two of the four leaks are in the exclusive economic zone of Sweden and the other two are in the exclusive economic zone of Denmark. Germany, Denmark, Sweden and Russia have all determined that the pipeline leak was caused by sabotage.

Asia

1. The onshore RMB exchange rate fell by 0.7 this week % to 7.2268 yuan per dollar.

a. The central bank introduced new measures this week, requiring banks to deposit reserves when selling related derivatives contracts, which effectively increased the cost of shorting the renminbi.

2. September Caixin PMI was 48.1, down 1.4 percentage points from August, the lowest in five months.

a. In September, the supply and demand of the manufacturing industry fell, and the decline was relatively small.

b. In September, the manufacturing employment index was weak, and the manufacturing purchase volume index and raw material inventory index continued to decline.

3. South Korea's trade deficit in September was US$3.7 billion, the deficit for six consecutive months, the first time in 25 years.

Encrypted ecological news

Encrypted market

1. DappRadar recently released the NFT report. Although the NFT market transaction volume decreased by 75% compared with the second quarter to 2 billion US dollars, it is expected that the sales volume will increase by the end of the third quarter. It rose 6 percent to 21.1 million.

2. USDC market value has decreased by $6.67 billion since July 1.

3.CoinDesk selected the 50 universities with the greatest impact on the blockchain in 2022, and the Hong Kong Polytechnic University ranked first.

4. The TVL in the DeFi protocol has fallen below 100 billion US dollars, a drop of 68% from December last year.

5. Japan plans to amend the anti-money laundering law to require encrypted transaction operators to share customer information.

6. The number of cryptocurrencies with a market capitalization of more than $1 billion has fallen by more than 55% this year.

7. MetaMask launched the asset portfolio view function, which can aggregate asset information across multiple networks and accounts.

8. The difficulty of Bitcoin mining has been reduced by 2.14% to 31.36T, which is the first difficulty reduction in the past two months.

9. Since Binance announced the automatic conversion of stablecoins to BUSD, USDC outflows have increased by 93%.

10. The vast majority of euro and pound holders choose BTC to deal with currency devaluation.

11. Long-term Bitcoin holders sell BTC at an average loss of 42%.

12. Messari data shows that the merger of Ethereum led to a 90% decrease in block rewards compared to the previous quarter.

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 and will continue in this stage How long will it take and what will happen

Short-term observation: used to analyze short-term market conditions; The possibility of a certain event

Long term insight

Cycle and new short-term capital model

Distribution of chips on the chain

After our research, we found that the hype funds in the market and retail investors On the contrary, it has a complementary relationship with large-scale and long-term main funds.

Cycle and nascent short-term capital model

Green area: the area that quickly loses the support of nascent capital

Pink Color area: the most depressed area.

Freshman hype money is a double-edged sword.

It often causes huge price fluctuations, and has a certain complementary relationship with the main force.

If the middle force is not there, the funds of relative giant whales will not be able to guide the market. Will cause a lot of collapse.

Of course, due to speculation, it will also cause huge price fluctuations.

The guidance of prices will also drive the tendency of speculative funds to explode.

From the perspective of speculative new funds, it has entered the lowest stage of the bull-bear cycle in the market.

Chip rating: When the inventory backlog is being cleaned up

Chain chip distribution

Current chip inventory backlog

Reviewing the inventory status in 2019:

The inventory backlog needs about 40% to be cleaned up;

In this way, the market can face the reduction of supply due to high-level chips taking over, and can better achieve the aspect of demand exceeding supply in terms of psychological inventory.

Mid-term exploration

Short-term to long-term realized value

New Entity Monthly to Yearly Ratio

Non-Zero Balance Addresses

Realized Market Cap

Total Stablecoin in Circulation

Number of loss addresses

Loss impact

Positive network sentiment

Net position of giant whale trading platform

Net position of miners

Illiquid supply and net position

Margin status rating: Liquidity still needs to be repaired, New users slow down

Short-term to long-term realized value

Observation within the month Exponential moving average of liquidity.

The current liquidity is between loss and slowdown, and the value is hovering around 0.04.

The monthly-to-annual ratio of new entities

The recent downward trend of new entity users has slowed down, and the monthly decrease trend below the annual decreasing trend.

Non-zero balance address

Blue line: non-zero balance address change rate

Green line: Non-zero balance addresses

Non-zero balance addresses have been hovering within a specific range for 45 days, which may mean that the current growth in the number of wallets is weak, which further shows that the speed of new users entering the market is also slowing down .

Market capacity rating: the decrement of realized market value has slowed down, and US funds have decreased

Realized market value

The acceleration in the process of reducing the realized market value has slowed down and is currently stagnant.

In the past 1 month, the daily realized market value of btc has decreased by 3.5-5.5 billion US dollars.

It may represent a change of hands in the field, which reduces the cost of holding currency in the field, or the loss of capital.

Total circulation of Stablecoin

Green line: USDT circulation

Blue line: USDC circulation

The acceleration of the USDT inflow process is reduced, and the current inflow is low.

The USDC circulation has decreased a lot, and there may be a heavy risk aversion sentiment.

Sentiment Rating: Loss-making addresses are close to this year’s high, and trading sentiment has slightly recovered

;The number of loss-making addresses

The number of loss-making addresses fluctuates repeatedly within the range, close to the high point of this year.

Loss impact

Blue line: loss impact volume

Green line: percentage of loss addresses

Loss address increases, loss impact volume However, it did not rise further, and it slowed down slightly. It may be that the panic of the current losers has slowed down.

Internet sentiment positivity

Internet sentiment positivity shows that there has been a slight recovery in trading sentiment recently.

Important group rating: giant whales slow down selling pressure, miners reduce holdings, illiquid supply is Undertake

Net position of giant whale trading platform

The potential selling pressure of giant whales has slowed down slightly.

Miners' net position

The untouched supply of miners is still relatively large.

Illiquid supply and net position

Illiquid supply is still growing at present, and may be one of the main players in the current market.

Short-term observation

BTC long liquidation advantage

ETH long liquidation advantage

Profit and loss transfer volume

Sell at profit and loss

Investors who hold for 1~3 months

Coin-day destruction

Net position of BTC trading platform

Global Time Zone Purchasing Power

Off-Chain Data

Derivatives Rating: The proportion of liquidated longs is close to a high level

BTC long liquidation advantage

long liquidation advantage Breaking through the high warning line is close to 56.3%, and the total liquidation volume of long positions is relatively low. This value belongs to the "false value" range. Pay attention to the following two situations:

1, the derivatives market continues to fluctuate

2, the market turned to short liquidation and the proportion of liquidation increased

The current rate of change in derivatives positions is still positive, and stock leverage still exists, with a neutral magnitude.

ETH long liquidation advantage

Ethereum long liquidation advantage shows the same trend, close to the high warning line of 55%, and similar situations need to be paid attention to.

Market Sentiment Rating: Adjustment

Profit and loss transfer amount

Tokens that are in a state of profit or loss, the transfer amount has begun to decrease recently.

The overall market sentiment shows signs of slowing down temporarily, and the focus is whether the Token in a state of loss will increase the amount of movement, resulting in a change in market sentiment.

Profit and loss selling

The market profit selling volume continues to shrink, and the market profitability is weak.

The market loss selling volume presents the same trend, which means that a large number of loss-making chips have been removed before.

In the short term, the stock chips are choosing to endure losses.

From the time dimension, the group holding 1~3 months is currently reduced to a lower position, which means The first position is that after the last sharp drop, most of the losing chips have been removed.

Sell pressure rating: slow down

coin days destroyed

The selling pressure of mature tokens in the market has continued to decline in the near future.

Comprehensive market transfer volume, on-chain transfer activity is at a low level in the short term.

BTC trading platform net position

In a relatively short period of time, a large number of Tokens have flowed out of the trading platform, and the potential selling pressure in the market has been reduced to a certain extent.

Buying Power Rating: Fix

Purchasing power of global time zones

Purchasing power of Asian time zones is still the main force in the market,

Currently, the purchasing power of European and American time zones is beginning to recover,

It needs to be watched whether the purchasing power of the Asian time zone can continue to support the market.

Off-chain data rating: around $18,000 has purchasing power

Binance trading platform order book

Binance has a touch of buy-side pending orders around $18,000.

Bitfinex trading platform order book

Bitfinex has a touch of buyer pending orders around $17,600 and $18,000.

Coinbase trading platform order book

Coinbase has intensive buyer pending orders around $18,000.

This week's summary:

Message surface summary:

1 .Affected by persistently high inflation and aggressive interest rate hikes by the Federal Reserve, the market has generally reached a consensus that the US economy may face a recession next year.

2. Affected by the fiscal stimulus of the British government’s tax cuts, British pension funds sold assets on a large scale. Although the Bank of England rescued the market this week, it has not eased the situation of continuing to sell assets, which shows the urgency of liquidity .

3. This week, the focus of the market is on the bond market. The depletion of liquidity in the bond market will lead to credit defaults and more investors leaving the market. The market predicts that a bond bear market may come.

4. In the context of high inflation, countries are faced with the dilemma of "maintaining growth" and "controlling inflation". The market is worried that adopting a fiscal stimulus policy similar to that of the UK may lead to out-of-control inflation, and the economy will return to the great stagflation of the 1970s .

Long-term insights on the chain:

1. From speculation From the perspective of new funds, it has entered the lowest period of the bull-bear cycle in the market.

2. The backlog of psychological bargaining chips will probably take some time to clear up;

3. Only in this way can the squeeze of demand exceeding supply be achieved within the psychological dispute in the market.

Market setting:

The market has entered the lowest stage, and what many participants are currently facing may not be the competition of the same kind, but how to be better survive.

In the midst of large-scale cleaning, surviving may welcome an unimaginable victory.

Interim exploration on the chain:

1. Liquidity It still needs to be repaired, and the entry of new users has slowed down;

2. The growth of wallet addresses has stagnated;

3. There may be handover and capital loss in the venue;

4. There has been a large loss of USDC funds, and the inflow of USDT has decreased;

5. The loss address has reached a high point this year, but the impact of losses has slowed down;

6. Trading Sentiment slightly restored;

7. The potential selling pressure of giant whales has slowed down, and miners still have a large reduction in holdings;

8. Illiquid supply may be the main body to undertake the market in the near future

Market setting tone:

Sluggish

The current risk aversion sentiment is heavy, funds are reduced, growth is slowing down, but losses are selling pressure is also shrinking.

The environment on the site is biased.

Short-term observation on the chain:

1. Long liquidation The proportion is close to the high level.

2. The amount of profit and loss transfer continued to decline.

3. The profit and loss selling volume is at a short-term low level.

4. Investors who hold for 1~3 months reduce their holdings to a low level.

5. The selling pressure of mature tokens is reduced.

6. A relatively large amount of Token has flowed out of the trading platform.

7. The purchasing power of the global period has been slightly restored.

8. Off-chain data has purchasing power around $18,000.

9. The probability of not breaking through 26770~33000 is 69%.

Market setting tone:

Sentiment is low, activity level is low, pay attention to possible short liquidation of derivatives.

Risk warning:

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