Dear friends, I am Jiali. Over the past few days, the crypto market has experienced a textbook-level 'violent washout.' Bitcoin has performed a dramatic roller coaster, plummeting from over $61,000 to returning to $71,000 within a few days, with a market value evaporating nearly 1.3 trillion yuan in a single day at one point. After this 'grand drama' directed by the collapse of leverage, the shattering of narratives, and macro pressures, as the smoke clears, we need to calmly examine the current real picture.
📊 Latest Market Trends Overview
The impact of this volatility is comprehensive, here is a summary of the key data:
· Bitcoin
· Current price: Approximately $71,400 (after a significant rebound).
· This round of deep pullback: From the historical peak of $126,000 in October 2025, the maximum decline exceeds 50%, once nearly halving.
· Market impact: It has erased all gains since Trump's election.
· Ethereum
· Current price: Approximately $2,100 (after rebound).
· This round of pullback: From the peak of $4,711, the maximum decline exceeds 55%, nearly halving.
· Key liquidation: Recently, there was a single-day liquidation exceeding $114 million, most of which was long positions.
· Overall market
· Total market cap volatility: Approximately 43% evaporated from the high point of about $4.19 trillion, dropping to about $2.3 trillion.
· Liquidation scale: During the recent volatility, over 570,000 people were liquidated worldwide within 24 hours, with a total amount reaching approximately $2.6 billion.
· Capital flow: The U.S. spot Bitcoin ETF has seen significant capital outflows, with some trading days experiencing net outflows exceeding $400 million. Data shows that the average cost for ETF holders is about $84,100, with many investors in unrealized losses.
· Chain reaction
· Mining under pressure: Some older mining machines (such as the Shenua M60S, Antminer S21 certain models) have reached their shutdown price.
· Institutional blow: The global largest Bitcoin-holding listed company Strategy's financial report shows that due to the depreciation of its Bitcoin holdings, it recorded a net loss of $12.4 billion in a single quarter.
🔍 How did the falling 'dominoes' fall?
This decline is not caused by a single factor, but rather a chain reaction that is interlinked:
1. Macroeconomic narrative reversal: The market's optimistic narrative regarding the 'Trump rally' and 'digital gold' is gradually cooling. The U.S. Treasury Secretary has explicitly stated, 'The government will not bail out cryptocurrencies,' which has shattered some investors' fantasies about a 'policy bottom' and become an important psychological threshold triggering sell-offs.
2. Systemic collapse of leverage: When prices break below key support levels (such as $75,000, $70,000), a massive amount of high-leverage long positions are forcibly liquidated. These passive sell orders flood into the market like an avalanche, instantly crushing buying liquidity, forming a death spiral of 'decline → liquidation → more selling pressure → further decline.'
3. Institutional capital retreat and crash: Previously important sources of incremental capital—spot Bitcoin ETFs—have turned to continuous net outflows. At the same time, companies like Strategy that adopt the 'financial flywheel' model (financing to buy coins) face enormous pressure under massive losses, and their potential selling may raise market concerns.
📈 Key positions and market status assessment
After the crash, both bulls and bears are fiercely competing at key positions:
· Key level of Bitcoin:
· Strong support zone: $60,000-$62,000. This is the 'panic low point' of this crash, where the market saw strong buying resistance and rebound, indicating significant demand in this area.
· Bull-bear dividing line: $70,000-$72,000. Whether it can stabilize and reclaim this area is key to determining if the market has transitioned from a crash to a consolidation phase. Stronger resistance is at $75,000-$78,000 (previous platform and ETF average cost area).
· Downside risk level: If $60,000 is effectively broken, the next important support may drop to the $55,000 area.
· Key level of Ethereum:
· Key support: $2,100-$2,130. This is an important weekly level support area in technical analysis and is critical for determining whether it can form a bottom.
· Reverse signal level: $2,600-$2,700. If it can break through and stabilize in this area, it may indicate a reversal of the short-term downtrend.
💡 Jiali's current observations and thoughts
After experiencing such intense clearing, the market is returning from an 'emotion-driven' extreme state to a balanced state of 'value game.'
1. Regarding the 'bottom': Although there was a violent rebound in the short term, it is still too early to assert that the market has formed a final bottom. According to on-chain data (like the NUPL indicator) and historical patterns, the true market bottom often accompanies a more thorough 'surrender-style sell-off' and panic. The current situation may be more akin to a technical rebound following a deep decline.
2. Regarding 'leverage': This market has given all participants a bloody lesson: in the crypto world, high leverage is the ultimate risk accelerator, not a profit amplifier. In a trending decline, any leveraged long position can become 'fuel' for the market.
3. Current operating thoughts:
· For holders: One should examine the position risk. If the rebound fails to reclaim $72,000 (BTC) / $2,600 (ETH), it remains a weak rebound, and heavy holders should consider reducing their positions.
· For short-term traders: The market is entering a high volatility consolidation period. Consider lightly entering near the support zone of $60,000-$62,000 (BTC) for a rebound, but be sure to set strict stop-losses and consider the $70,000-$72,000 area as a primary profit-taking point. Avoid chasing highs and cutting losses.
· For long-term investors: The real opportunity comes after despair. You can start closely monitoring the market, but there is no need to rush to 'catch falling knives.' Patiently wait for market volatility to decrease and for a clear bottom structure to form before gradually positioning, which will be a more prudent choice. The next big cycle's starting point might be when the market is least noticed.
I am Jiali, recording my thoughts at Binance Square. The market is ever-changing, and the above is merely my personal market analysis, not constituting any investment advice. Survival is the top priority, and I hope we can all weather the cycles.
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To help you grasp the future market more clearly, consider the following questions:
1. What is your current leverage ratio? Do you have a risk management plan to cope with extreme market conditions?
2. If the market enters a wide range consolidation of $60,000-$75,000, how will your trading strategy adjust?
3. Besides price, which indicators do you currently pay most attention to for judging market sentiment (such as the greed-fear index, exchange flow, stablecoin market cap, etc.)?
