📌 Event Review

Recently, the Bitcoin market has experienced a round of severe fluctuations. The market began to face pressure from rising capital costs and tightening liquidity after the release of the non-farm payroll data in January, while some institutions faced significant risks from leveraged long positions. Data shows that from 22:30 to 23:10, the price of Bitcoin quickly plummeted from a high, triggering a chain liquidation effect and increasing panic in the market. Although there was a slight rebound in price at 23:40, the overall oscillation pattern remains evident.

⏰ Timeline

• 22:03: The US non-farm payroll data for January was released, showing that new jobs exceeded expectations, and the unemployment rate fell to 4.3%, leading to a significant decrease in market expectations for an earlier interest rate cut (the probability of a rate cut in April dropped from about 40% to 20%). Capital cost and liquidity expectations tightened.
• 22:30: The BTC price reached about $68,220 at a high, and some highly leveraged long positions faced risks, triggering stop-loss liquidations.
• 22:30–23:10: Bitcoin's price experienced a rapid decline:
• From about $68,220 it plummeted to approximately $65,821 (a decline of about 3.53%);
• Another set of data showed the price dropping from $67,974 to $65,719 (a decline of about 3.32%).
• 23:08: BTC broke through the crucial support level of $66,000, exacerbating stop-loss triggers and panic sentiment.
• 23:40: The market briefly rebounded, with BTC rising to about $66,635.8, but the oscillation trend remains evident, and uncertainty continues in the following market.

🔍 Cause Analysis

The recent sharp fluctuations in the market were mainly driven by two core factors:

1. Macro Economy and Policy Expectation Changes
   The strong performance of the non-farm payroll data was expected to signal economic resilience, but it also decreased market expectations for an early rate cut from the Federal Reserve. The rise in capital cost expectations led investors to become cautious about the valuation of risk assets, triggering risk-off selling.

2. High Leverage Trading Risks Triggering Chain Liquidations
   During the market uptrend, many institutions and whales sought to amplify returns through high leverage operations. Once market sentiment turned, the risks of high leverage positions were exposed, leading to system stop-loss and forced liquidation effects, which further intensified selling pressure and caused rapid price declines.

📊 Technical Analysis

Based on Binance BTC/USDT perpetual 45-minute candlestick data, we can observe the following key points from a technical perspective:

• OBV Indicator Change: Transitioning from negative to positive, indicating a slight improvement in market sentiment, with buying attempts starting to emerge.
• Surge in Trading Volume: Trading volume increased by 150.46%, and the current volume is significantly higher than the 10-day and 20-day averages, indicating a substantial increase in capital activity in the short term.
• Moving Average Arrangement and Candlestick Patterns: The price is currently below the EMA5, 10, 20, 50, and 120 moving averages, all displaying a perfect bearish arrangement, indicating a strong downtrend. A doji candlestick pattern has appeared, suggesting market hesitation and possibly indicating an early trend reversal signal.
• Explosive Orders and Large Transactions: In the past hour, the total explosive order amount reached $6 million, with a long position ratio up to 67%, and principal funds showing a net outflow of about $10 million, reflecting that large quick orders and liquidation actions are exacerbating liquidity tightness.
• TD Price Reversal: While there are localized bullish price reversal signals, the overall moving average system and market structure still lean towards bearishness.

🔮 Market Outlook

Although some technical indicators show signs of buying intervention and an improvement in sentiment (such as the OBV reversal and TD price reversal), the overall battle between bulls and bears remains fierce. Future trends may face the following scenarios:

• Short-term Technical Support: Key support levels may play a role around $66,000; if subsequent buying is strong enough, it could push the price to form a short-term rebound.
• Continued High Leverage Risks: If market sentiment remains weak, high leverage positions may trigger new chain liquidations, leading to further declines.
• Macro and Policy Influences: Under the gradual shift in the Federal Reserve's policy towards tightening expectations, investors need to closely monitor macro data and subsequent policy statements while maintaining cautious positioning.

Overall, under the dual impact of the current macro economy and high leverage risks, Bitcoin is still likely to face severe fluctuations in the short term. Investors are advised to control their positions, closely monitor key technical support and capital movements, and wait for market stabilization signals before making further arrangements.

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