On June 25th, after Bitcoin fell to the lower boundary of the long-term Rainbow Chart model, OEXN indicated that this signal more resembles the market entering a phase of extreme pessimism rather than a mere technical model failure, leading to more pronounced short-term trading disagreements between bulls and bears.
From a historical perspective, OEXN believes that similar models are more likely to be used by the market as a gauge of sentiment during extreme phases. Some capital views a drop into deep pessimism as a precursor to a valuation recovery, while other funds worry that old models can no longer adequately explain the new market structure following the introduction of ETFs and institutional participation.
The report mentioned that Bitcoin's pullback from its peak is nearing 50%, a magnitude that in itself intensifies market discussions about the lower trend limit. For the current market situation, what is truly critical is not the labeled range names, but whether the price can establish a new support zone amidst the pessimistic expectations.
As the debate over the model continues to unfold, OEXN anticipates that the market will remain locked in a tug-of-war over whether valuations are undervalued. In OEXN's view, only when fund flows, volatility, and trading structure improve in tandem will sentiment indicators transform into a more substantial reference for a market bottom.
Comments