How does Yi Lihua view this round of market game, where the bears' final effort to reverse has become fuel for short squeezing?

Liquid Capital founder Yi Lihua recently stated that the bears are still making their final efforts, and all of their short positions will become fuel for short squeezes during an upward move. This view reflects his judgment of the current market landscape and demonstrates the understanding of market cycles by a veteran player with a decade of experience.

The Bears’ “Last Stand”

In his article, Yi Lihua mentioned that the bears have heavily bet on several factors: the four-year cycle, the US stock AI bubble, and declining liquidity. But he believes “all of these have failed.” This assessment warrants a closer look.

According to the latest news, Yi Lihua’s recent actual operations confirm this view. His holding of 626,574 ETH has already broken even, with the average cost dropping to $3,105.5. Meanwhile, among his publicly selected targets, BCH and WLFI have increased by 19.6% and 15.46%, respectively, with an overall hit rate of 83.3%. These data indicate that the trend-following investment strategy is being validated amid market volatility.

Investment Philosophy vs. Market Play

The core logic emphasized by Yi Lihua is very clear: the true core of the crypto space is continuously improving the understanding of investment and trading. He summarized his investment principles as:

• Stick to trend investing, ignore short-term fluctuations
• Be greedy when others are fearful, be fearful when others are greedy
• Make money from value and trend, not through gambling

This stands in stark contrast to the bears’ “big gamble.” The bears are betting on external variables (cycles, bubbles, liquidity), while Yi Lihua is aligning with the market’s big trend. The former is about fighting the market; the latter is about following it.

The Meaning of “Fuel”

Yi Lihua said that the bears’ short positions will become “fuel for short squeezes during an upward move.” The logic here is: when the market truly starts to rise, short sellers are forced to cover and buy back, and this passive buying will further push prices higher, accelerating the rally. This is not his speculation but based on observations of market structure.

From his recent comments, he is very confident about a major bull market in 2026. He previously stated that before the 2026 bull run, shorts would close early with small losses, and later close with significant losses. The underlying assumption is: the trend is already established, and it’s only a matter of time.

Points Worth Reflecting On

It is worth noting that Yi Lihua also tests his judgment in practice. He not only cut losses on ASTER (reason: “the team couldn’t find the founder”) but also continues to hold the targets he believes in. This shows that within the trend-following framework, he is still making refined choices. This combination of firmness and flexibility may be more valuable than simply being “bullish” or “bearish.”

Summary

Yi Lihua’s view on the bears’ “last effort” reflects a collision of two different market participation approaches. One bets on macro variables, the other follows market trends. Based on his recent actual results, trend-following strategies have been validated in this cycle.

But this does not mean that bears will necessarily fail, nor that trend investing will always win. Markets will always have disagreements. The key is to understand your own strategic logic and continuously adjust through market validation. Yi Lihua’s success today is largely because he has learned how to face setbacks and stay clear-headed across different cycles. This may be more meaningful than his specific viewpoints themselves.