Talking About Li and Beyond: ETH FUD Pre-Trump Inauguration, Market Outlook and More

As Bitcoin's price continues to fluctuate dramatically, retail investors are panic-selling while institutions like MicroStrategy are accumulating more Bitcoins. This stark contrast in behavior highlights the influence of macroeconomic factors on the market.

Meanwhile, as Trump's inauguration approaches, some people speculate about possible market manipulations to create a smooth transition during this period.

In the previous Talking About Li and Beyond article (January 13), we mainly discussed exiting a bull market and shared how to design your own exit indicators. The point of the article remains: we should strive to form and establish our own trading systems, rather than being swayed by news and emotions. Trading also requires consideration of cycles; if your goal is 10 or 20 years into the future, then Bitcoin at this moment is not expensive no matter when you buy.

Having discussed the basic market conditions, let's continue to talk about Ethereum, which is currently being FUDed daily.

In previous Talking About Li and Beyond articles on the topic of Ethereum, we mentioned that factors such as capital inflow, continuous accumulation by whales, and ETH staking would collectively support the price outlook for ETH. So, let's continue to explore a few dimensions based on this logic.

First, let's look at the inflow/outflow situation of ETH ETFs in recent days. Since last week (January 7), ETH ETFs have seen continuous capital outflows, which is certainly not favorable for Ethereum's price performance from a sentiment perspective.

Next, let's examine the K-line trend. Currently, the price has dropped close to the 0.382 level, and the weekly MACD has begun to show a crossover, indicating that short-term fluctuations are likely to continue.

Furthermore, let's check the ETH balance on exchanges. From on-chain data, the amount of ETH stored on trading platforms has entered a phase of decline again, which may reflect some funds' optimistic views and confidence in Ethereum's future.

In summary, at this critical position and time point, there seem to be two distinct camps regarding Ethereum: one camp continues to be optimistic about Ethereum's future performance, believing this position is an opportunity to accumulate more. The other camp believes that Ethereum's current bull market is completely over, and it would be better to clear out Ethereum as soon as possible.

As for how you view and choose, we won't interfere or provide any specific trading advice, but if you often read articles from Talking About Li and Beyond, you should know our answer.

Additionally, from a fundamental perspective, Ethereum remains a cornerstone of the DeFi ecosystem, accounting for about 82% of TVL.

However, currently, Ethereum is indeed lagging behind ecosystems like Solana and Sui in terms of Daily Active Addresses, Daily Transactions, and Dex Volumes.

Moreover, the deflationary effect that many anticipated after Ethereum's upgrade does not seem to be significant at this point. Meanwhile, with the increasing popularity of L2, there are concerns that Ethereum may slowly fall into a predicament where the ecosystem remains prosperous but the value realization of its tokens continues to decline.

However, it cannot be denied that ETH remains second only to BTC. As long as Ethereum can find a new balance in L2 expansion and other narrative waves, the price will naturally not be an issue. Let's allow the bullets to fly a bit longer.

Or to put it more bluntly, the price of ETH in this bull market is unlikely to stop around $4,000. Here, I directly quote a line from our previous article: as a cryptocurrency that does not face unlocking and miner sell pressure, a coin that is still the king of altcoins, a coin that remains the largest crypto ecosystem, and the only cryptocurrency besides BTC that has been approved for an ETF… we may need to maintain some patience with it.