What are the reference dimensions for the long-term and medium-short term price trends in the market?

Source: Talking about Li and Talking about the Outside

It seems that many people are staring at market prices every day, especially those who are fully invested in altcoins. Some are considering whether to withdraw to break even, while others are still hoping for a further increase to recover their investments…

Recently, most of the messages received in the backend are questions about prices and what to buy. For example, some people ask: Can Bitcoin really rise to $150,000 next? I bought Ethereum at $3,800; is there still a chance to break even? I heard that the altcoin season is coming; what coins are good to buy now? And so on.

From a simple look at the user information in the public account backend, most of those who raised these questions are new followers of Talking about Li and Talking about the Outside. Perhaps these new partners are still unsure about investing, so they directly base their hopes of making money (or breaking even) on the opinions or suggestions given by others.

At the same time, I also noticed another interesting phenomenon: since the new market phase started again last month (April), the average number of people unfollowing has been greater than the number of new followers. In other words, over the past month, the total number of followers in the backend has not only not increased but has slightly decreased.

However, I think this is quite good; everyone should make choices that suit themselves and appropriately reduce the interference of others on their investment strategies. To be honest, Talking about Li and Talking about the Outside has always insisted on producing long-form content, which may not be suitable for everyone. After all, in this era of massive information, there are relatively few people who can calm down and patiently spend time reading long articles. Some prefer fast food, while others prefer home-cooked meals; it's just a matter of choice. We will continue to maintain a laid-back output, and everyone can follow along as they wish.

In fact, learning is often a process of going from many to few. For example, many people start by following dozens or even hundreds of bloggers or joining dozens of different circles. Then, as they slowly form and establish a set of investment strategies or methodologies that suit them, they may choose to filter out and block most of the ineffective information and exit most circles, thereby further maintaining better personal thinking and focus.

In short, everyone's background, experience, and risk tolerance vary greatly, and each person's thinking model, knowledge experience, observation perspective, and interests are also different. Different perspectives can lead to different conclusions about issues, so many questions do not need to be divided into right or wrong. Different people should make different choices; only what suits you is the best. Especially in the investment field, we should not always fantasize about pursuing a universal, lazy-friendly, and highly profitable money-making model. The real money-making models have certain thresholds, such as capital thresholds, time thresholds, cognitive thresholds, and so on.

In the previous article (May 12), we mainly discussed some macro factors affecting market trends. However, regarding market trends, some people prefer to focus on macro factors, while others prefer to pay attention to certain data or indicators. Next, let's list some data/indicator dimensions:

For example, we can pay attention to the changes in funding rates, as shown in the figure below.

As the market has recently warmed up, the number of bullish traders in the market will increase, and they are willing to pay fees to bearish traders. Therefore, we can observe the changes in funding rates to monitor short-term market trends.

For example, we can also pay attention to the changes in open interest, as shown in the figure below.

Open interest can serve as an observation dimension for trading activity. We can observe whether traders still have trading interest in the short term by looking at the changes in the range of open interest.

Additionally, we can monitor the changes in stablecoin inflows, as shown in the figure below.

If there is no significant outflow of funds (negative inflow), it may indicate that traders are still rotating funds among various projects, and there is no need to worry about short-term market fluctuations.

Alternatively, we can also assess market changes by looking at the trading volume changes between CEX and DEX. If the trading volume on DEX has increased recently, it usually indicates strong current market demand and upward momentum, as shown in the figure below.

In short, different risk preferences correspond to different investment styles, and different investment styles can have various information or data dimensions that can be used for auxiliary reference. This also divides into long-term and medium-short-term investment considerations.

The funding rates, open interest, stablecoin inflows, and other dimensions mentioned above can serve as references for medium-short-term considerations. Additionally, you can also record and summarize many other reference dimensions, such as the ETH/BTC ratio, BTC.D, USDT.D, Fear & Greed Index, Altseason Index, Speculative Sentiment Index, etc., which we have previously shared and introduced.

If you are interested in long-term indicators for Bitcoin, you can also directly use the "Bitcoin Indicator Template" we organized in previous articles, which includes over 35 comprehensive indicator data to observe and assist in guiding long-term Bitcoin trading, as shown in the figure below.

Of course, most people may currently prefer to use candlestick charts to guide their trading directly, which is perfectly fine. We have also organized some basic knowledge about candlestick charts in previous articles. Those interested can continue to search for and review the historical articles of Talking about Li and Talking about the Outside.

Here, we take BTC as an example to briefly look at the candlestick market:

From a weekly perspective, the MACD has crossed, indicating a good upward trend. Currently, Bitcoin is attempting to reach its historical high. Considering the overall market sentiment, Bitcoin may enter a consolidation phase after reaching or breaking the historical high, while BTC.D may continue to decline. However, the weekly level still forms an FVG gap (the red box area I marked in the figure below), so we need to pay attention to the $93,000 position. However, it seems that the probability of dropping to the next FVG position (around $80,000) in the short term is relatively low, as shown in the figure below.

Continuing with the 4-hour level, the area around $98,000 is a position to watch. However, if it retraces to this position, it seems likely to rebound again, and then we will look at the area around $93,000, where it is possible that these two positions will be filled, as shown in the figure below.

Similarly, if you are more concerned about the short-term price of ETH, you can also refer to the above methods for your own judgment. Currently, it seems that the $2,700-$2,900 range is a resistance area for ETH, and this range may also be accompanied by significant selling pressure (there should be many trapped positions at this level). If it goes down, the position to watch in the short term appears to be around $2,200.

However, it is necessary to remind again that while we briefly discussed the candlestick market above, it is merely a discussion and reference of ideas, not investment guidance or advice. Short-term market trends cannot be predicted; you need to make your own judgments based on your risk preferences and positions.

Personally, aside from the need to write articles daily, I rarely look at candlestick charts; I only casually glance at the weekly level. I am not very suited to being a trader/analyst or to doing short-term trading. My current pursuit is to be a simple person and do simple things.

So, what is your pursuit? What kind of trading style do you belong to? Do you have corresponding long-term or medium-short-term reference dimensions to guide your trading?