On Monday, the market was pulled back and forth all day, but it still failed to truly break through the key resistance level on the 4-hour chart, indicating that the current trend has not escaped the dominance of bears. Although there was a certain repair and rebound in the short term, judging from the attitude of funds and structural performance, the market is still in a tug-of-war phase of "bulls attempting a counterattack, bears controlling the pricing power."

The core contradiction in the current market is very clear: there is a rebound demand after a short-term overselling, while the medium to long-term trend is still bearish. There is momentum in the rebound, but it has not formed a trend; bears have the advantage, but for now, they cannot continue to create a panic sell-off. Therefore, the market is waiting for a true catalyst that can break the balance.

This catalyst is likely to be the U.S. May CPI data announced tomorrow. As the most important macroeconomic event of this week, the CPI results will directly impact the market's judgment on the Federal Reserve's subsequent policy path. If the data is below expectations, the interest rate cut expectations will warm up, and BTC has a chance to make an upward push towards 65,000; if the data is above expectations, the market may reprice the prolonged high interest rate environment, and even the risk of interest rate hikes, at which point selling pressure may be quickly released again.

Meanwhile, the phased easing of the situation in the Middle East has also led to some "buying on dips" sentiment in the market. However, from the performance of funds, most institutions and mainstream capital still believe that the current rebound lacks sustainability, more like a technical recovery after a sharp decline, rather than a trend reversal.

It is worth noting that the Fear and Greed Index has fallen to the extreme fear area around 8-13. Historically, whenever market sentiment reaches such an extreme level, it often means that a phase bottom is forming. But the problem is that a sentiment bottom does not equate to a market bottom. A true bottom also needs to meet one condition—leveraged funds need to be fully cleared.

Currently, ETF funds are still continuously flowing out, and the process of deleveraging has not yet fully ended, so the market is still some distance away from truly confirming a bottom.

Overall, the current market has entered a critical window before choosing a direction. Short-term rebounds and large-scale bearish trends coexist, and the CPI will determine whether the next phase of the market will continue to repair or return to a downward channel.
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This article is originally published by 【Huiying Community】 and only represents personal views. Due to certain delays in information transmission, the content is for reference only and does not constitute any investment advice. Please make rational judgments and operate cautiously.
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