To The Moon

Amidst the current macroeconomic environment where AI and related sectors are stealing the spotlight, the performance of crypto assets this year has been exceptionally weak, failing to capture any upward momentum. The reality is that in the realm of narrative-driven assets, Bitcoin's history and storytelling capabilities are just as strong as any other asset. However, once expectations are overdrawn and fail to materialize, a return to reality is inevitable. Nevertheless, after a sustained decline, the likelihood of a short-term stabilization and a corrective rebound is increasing.

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First, looking at the monthly chart, Bitcoin has entered its ninth cycle this month. Given that the crypto market remains a relatively small and nascent sector, there isn't a long history of chart data to reference, making the reliability of such signals relatively low. However, the last time a similar signal appeared, the price experienced a period of consolidation and sideways movement before launching a new uptrend. Furthermore, the $60,000 to $50,000 range itself is an area of intense historical volume and fierce tug-of-war between bulls and bears. A massive amount of long-term positions have their break-even points in this zone, meaning stop-loss orders won't be triggered until the bottom is decisively broken. Therefore, from both a technical perspective and the distribution of long and short positions, there is a good chance we will see Bitcoin form a short-term bottom and attempt a rebound in July. If this hypothesis holds true, a recovery phase from July to October, followed by renewed weakness in the fourth quarter, would align perfectly with macroeconomic expectations of late-year interest rate hikes or renewed geopolitical uncertainties in the Middle East.

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Turning to the "runner-up," Ethereum, the monthly chart shows a similar structure, while the daily chart has flashed a combined "13" buy signal. The previous three times a similar setup occurred, they all resulted in varying degrees of rebounds or reversals, offering a high reference value. Meanwhile, the bears' attempt to break the 1540 support level failed. Instead, on a lower timeframe, Ethereum is facing a potential double-bottom opportunity following a breakout above 1851, with a theoretical rebound target pointing towards 2140. Over the next one to two weeks, as long as Bitcoin and Ethereum can avoid printing new lows, the probability of a rebound will increase significantly.

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Moreover, although the reference value of crypto assets as leading indicators has been significantly diminished, their inherent nature as risk assets remains helpful in forecasting the trajectory of other asset classes. For instance, since the second quarter of this year, precious metals have shown a solid positive correlation with cryptocurrencies. Last week, we anticipated that gold would need a correction after printing a "9" signal on the weekly chart, and the price of gold did indeed experience a rebound. If crypto assets can stabilize, precious metals will likely have even more room for a subsequent rebound.

Of course, whether it's the crypto sector or precious metals, further declines will still be necessary after this current rebound plays out before they truly enter a zone of potential investment value. From a medium-term perspective, if prices reach an ideal, relatively high rebound level, the safety margin and risk-reward ratio for initiating short positions will still be much higher. However, it's worth noting that summer market action is typically slow and sluggish, requiring patience as we wait for prices to climb and hit their targets.

Regarding trading strategies, the long Euro futures positions we previously established were filled at 1.1420. As the exchange rate hasn't made much progress, we are not making any adjustments. The stop-loss and targets remain unchanged: stop-loss placed below 1.1300, and targets set at 1.1770 and 1.2420 (half position for each).

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For crude oil, with the long orders filled at the 70 price level, our limit orders are completely executed, bringing our average entry price to 75. Similarly, although prices remain under pressure, volatility was limited last week, so we will stick to our original plan. The stop-loss is set at 60, with targets at 95 and 115 (half position for each).

For this week's new strategy, we are placing limit orders for Ethereum: Buy limit at 1600, stop-loss at 1510, with targets at 1900 and 2120. This order is valid for the current week. Additionally, if there is a rebound towards 2100, initiating a short position could be considered; however, since the likelihood of reaching that level is very low, we will not set a limit order for it at this time.

P.S. If the trade successfully hits the first target, the stop-loss will automatically be adjusted to the breakeven (entry) level. Any adjustments after execution will be updated in subsequent articles.