• Every cycle has its days of 'red hot' markets, but not every red day is the same. The important thing is not how much the price decreases, but who is being forced to leave the market.
• At the present time, the data shows:
– Funding rate cools down.
– Open interest decreases.
– But spot selling does not explode.
→ This indicates that: leverage is being unwound, not that long-term holders are selling their positions.
• In previous cycles, such phases usually occurred:
– After a period of excessive longs..
– Before the market finds balance
– And before the easiest DCA phases.
• When the market is truly risky:
– Spot volume spikes significantly.
– Stablecoin dominance spikes.
– BTC dominance drops.
Currently, those signals have not been seen occurring simultaneously.
• This places BTC in a state of 'internal risk-off':
– Risk-off with leverage.
– But it's not a risk-off for the crypto system in general.
• Therefore, for long-term investors:
– This is not the time to go 'all-in'.
– But it's also not the time to stand aside out of fear.
– Rather, it's a time for disciplined DCA, when the market is pushing hasty individuals to leave.
Conclusion:
The cycle does not reward picking tops and bottoms, but rewards those who understand the liquidity context in which they are buying.
👉 In your opinion, is it currently a temporary risk-off or the beginning of a distribution phase?
Let's discuss 👇
#BTC #liquidity #MarketCycles #RiskOnRiskOff #DCA
