Source: WTR Research Institute

This week review

This week, from October 2nd to October 9th, the highest price of Ice Sugar Orange was near $28580, and the lowest was close to $27160, with a fluctuation range of about 4.97%. Observing the distribution of chips, there were a large number of chips traded around 27000, which will provide certain support or pressure.

Analysis:

1. 26000-31000, approximately 4.28 million pieces.

2. 20000~25000 is approximately 1.63 million coins.

• The probability of not breaking below 24000~26000 in the short term is 79%.

• The probability of not breaking through 32000-34000 in the short term is 65%.

Important News

Economic News

1. Federal Reserve's Mester: May need to raise interest rates again in 2023 and maintain for a period of time.

2. The US non-farm payroll data in September was almost double the expected amount, and the market predicts that the time for interest rate cuts will be postponed from July next year to September.

In September, non-farm employment increased by 336,000 people, and the unemployment rate remained unchanged at 3.8%.

Encryption ecosystem news

1. The Real World Asset Protocol Backed Finance has issued a tokenized US Treasury bond ETF named blB01 on the Base chain, offering a 5.2% return.

2. A US judge rejected the SEC's appeal of the ruling on $XRP in the Ripple case.

3. Multiple Ethereum futures ETFs listed, with total trading volume less than two million US dollars on the first trading day.

4. Jefferies Investment: BTC is a key hedging tool against inflation, on par with gold.

5. The Speaker of the United States House of Representatives, Kevin McCarthy, has been removed from office, and the crypto-friendly congressman Patrick Mchenry has been appointed as his temporary replacement.

6. Ripple has been awarded a major payment institution license by the Monetary Authority of Singapore.

7. The number of active developers in the encryption field has reached its lowest point since 2020.

In September, DEX trading volume hit a new low since January 2021.

9. OpenAI founder Sam Altman expressed his belief on Joe Rogan's podcast that Bitcoin has the potential to become a universal currency.

Long-term Insight: Used to observe our long-term situation; Bull market / Bear market / Structural changes / Neutral state.

Mid-term exploration: Used to analyze what stage we are currently in, how long this stage will last, and what situations we will face.

Short-term observation: Used to analyze short-term market conditions; as well as the possibility of a certain direction and the occurrence of a certain event under certain conditions.

• Short-term participant profit percentage compound model

(Network sentiment positivity in the figure below)

The circulation of the market is slowly recovering, and this trend may still be maintained at present. The difficulty of shorting may be slightly higher before weakening. From the previous situations, there will be early performance in the mid-term trend, and the market may choose a positive attitude at a certain point, so this data will show a positive performance.

(Trend of new user volume as shown in the figure below)

The short-term liquidity of the market depends on the support of new user volume. This model examines the trend of new user volume through the circulation and expenditure status of market value. Usually, in the case of long and short-term divergence, the increase in the proportion of long-term participants and the decrease in the proportion of short-term participants are judged as long and short-term turnovers, but it may also be that the market's enthusiasm for new user volume participation has sharply declined. Currently, the willingness of new user volume to participate is gradually recovering, that is, the circulation status of this group is slowly recovering, and there may not be too much performance in the short term, which requires some time.

(High weight pressure as shown in the figure below)

High weight pressure has been applied in the market and may require some time to digest. Based on current performance, there may be adjustments within a certain range, and this trend may be maintained until there is a market change.

(Short-term participant profit percentage compound model as shown below)

• Blue line: Accumulative supply of the group

• Yellow line: Short-term participant supply accumulation-type groups show strong willingness to increase holdings, and recent buying actions have been significant, indicating a certain amount of buying interest in the market's current performance.

Meanwhile, short-term participants are currently experiencing a certain degree of emotional relief, reducing their willingness to sell off and exit.

Short-term Observation

• Derivative risk coefficient

• Option intention transaction ratio

• Derivative trading volume

• Implied volatility of options

• Profit and loss transfer amount

• New addresses and active addresses

• Net Head of Bingtang Orange Exchange

• Net Head of Auntie Exchange

• Global purchasing power status

• Stablecoin exchange net head

• Off-chain exchange data Derivative rating: The risk coefficient is in the danger zone, and the risk is increasing.

(Risk coefficient of derivative products as shown in the figure below)

The risk coefficient has been hovering in the danger zone for the past week, but there has not yet been a significant short squeeze, and it is expected to remain consistent with last week.

(Option Intention Transaction Ratio in the figure below)

The trading volume of options has slightly increased, and the ratio of put options compared to last week has not changed significantly, currently at a median level.

(Trading volume of derivative products as shown in the figure below)

However, the current trading volume of the derivative products has not fluctuated much and remains at a low level, indicating that many traders are in a wait-and-see state. But it also suggests that volatility is not far away.

(The implied volatility of options in the following figure)

The implied volatility of options has not changed much compared to last week, and the activity of options traders is generally moderate.

Emotional state rating: Neutral

(Profit and loss transfer amount in the following figure)

The rise in prices has led to an increase in positive sentiment, while panic sentiment remains low. The current price has reached the cost range for short-term holders. This week, we will continue to focus on market panic sentiment represented by the transfer of losses.

(新增地址和活跃地址)

This week, there has been a slight decrease in newly added addresses and a small decrease in active addresses. The on-chain activity level is relatively low.

Spot and selling pressure structure rating: Overall, it presents an accumulated outflow state with relatively low selling pressure.

(Net Head of Bingtang Orange Exchange as shown in the following figure)

The current state of Da Bing is in a state of moderate outflow.

(The head of E-Too Exchange is shown in the figure below)

E is currently in a state of minimal inflow.

(High weight pressure as shown below)

Currently there is no high-weight pressure.

Purchasing Power Rating: Global purchasing power has slightly rebounded, and stablecoin purchasing power has slightly rebounded.

(Global purchasing power status in the following figure)

Asia and Europe's purchasing power is still recovering, while the heavier-weighted purchasing power in the Americas has turned negative.

(Net leader of USDT exchange as shown below)

USDT is currently experiencing a small inflow.

Off-chain transaction data rating: There is a willingness to buy at 26,000 and a willingness to sell at 29,000.

(下图 Coinbase 链下数据)

(Coinbase off-chain data in the following figure)

There is a willingness to purchase around the price range of 23000, 24000, 25000, and 26000.

There is a willingness to sell at prices around 29000, 30000, and 31000 in the encryption industry.

(下图 Binance 链下数据)

(The following image shows Binance off-chain data)

There is a willingness to purchase at prices around 25000, 26000, and 27000.

There is a willingness to sell at prices around 29000, 30000, and 31000 in the encryption industry.

(下图 Bitfinex 链下数据)

Translation:

(The following is Bitfinex off-chain data)

There is a willingness to buy at prices around 23000, 24000, and 26000; there is a willingness to sell at prices around 30000.

This Week's Summary:

Summary of News:

1. With the US non-farm payroll data exceeding expectations, market traders seem to be betting on the last interest rate hike of the year taking place in November. The world's attention is also increasing as this may be the last interest rate hike of the year or there may be no interest rate hike at all, depending on the Federal Reserve's own choices and early comments.

From a cyclical perspective, under the continuous impact of negative news, the market's resilience has increased. More people are slowly shifting from searching for evidence of negative news to searching for evidence of positive news, with many people paying attention to the upcoming halving.

The capital market is a game of expected outcomes. When the most difficult times have passed, it can be imagined that the time of prolonged decline will also decrease in the future, and even usher in a special structural market trend.

On-chain Long-term Insights:

1. The updated status of market derivatives provides a deeper exploration of market cycle fluctuations and a more predictive role in identifying phase tops and bottoms.

2. Currently, the market situation of derivatives is neutral in the medium to long term.

• Market tone: The derivative structure of the market is relatively stable and has not undergone much change. The next issue will focus on data research related to black swan events.

On-chain Mid-term Exploration:

1. The market's circulation is good, and currently it is difficult to short.

2. The amount of new entrants is in a state of repair;

3. There is selling pressure in the market that needs to be absorbed;

4. The number of accumulative investors is increasing, and the selling intention of short-term participants is decreasing.

• Market tone: Repair

The current market liquidity is performing well, and it may become more difficult to short when it does not show weakness.

1. The wind risk coefficient is in the danger zone, and the wind risk is increasing.

4. The net position of the exchange as a whole is in an accumulated outflow state, with relatively low selling pressure.

5. Global purchasing power has slightly rebounded, and stablecoin purchasing power has also slightly rebounded.

6. Off-chain transaction data shows a willingness to buy at the 26000 price level and a willingness to sell at the 29000 price level.

7. The probability of not breaking below 24000~26000 in the short term is 79%; the probability of not breaking above 32000~34000 in the short term is 65%.

• Market tone: The market sentiment is neutral, with slightly less positive sentiment compared to last week. In the short term, there is a certain probability of short-term volatility based on the data, but this week we are more concerned about the impact of news.

Strategy Recommendation: Spot Dynamic Hedging

Welcome to join the official BlockBeats community:

Telegram Subscription Group: https://t.me/theblockbeats

Telegram Discussion Group: https://t.me/BlockBeats_App

Official Twitter Account: https://twitter.com/BlockBeatsAsia