I remember last year (2023), many new partners who joined me left me a message saying that their goal for this round of bull market was at least 10 times, and some partners also set a goal of 100 times. As a result, over the past year or so, although the market is experiencing a bull market, the goals of many partners have changed from 10 times to 100 times: as long as they can get their money back!
In recent days, the market is still filled with panic, and many people seem to be getting impatient again. In the first two articles of Hualihuawai, we talked about the current market and market conditions. Today we will continue this topic.
In terms of development history, I still believe that the current crypto market is still in a relatively early stage compared to other financial markets. However, with the pace of ETFs and the in-depth participation of major institutions, the current crypto market seems to be controlled by various funds and big players, who can easily manipulate this emerging market with a market value of $2 trillion without even much effort.
In terms of operations, institutions and big players have accumulated a large amount of supply. Not only can they easily instill fear into the market by selling, and then buy back low-priced chips from retail investors, but they can also boost market sentiment through large-scale purchases, bring new liquidity to the market, and attract leeks to take over again. Regardless of the market's ups and downs, these funds and big players seem to be able to make money from the leeks.
Although the recent decline in Bitcoin has exceeded our expectations, many people have also handed over their chips. However, we can find through on-chain data that many whale addresses are continuing to accumulate Bitcoin. As of now, the number of wallet addresses holding more than 10,000 Bitcoins has reached the highest level in 6 years. And since June this year, they have accumulated more than 212,450 Bitcoins (accounting for 1.05% of the total supply). As shown in the figure below.
When retail investors choose to sell, many whales are accumulating. If you want to hold on to your pie, it is sometimes difficult without enough faith and patience, and whales take advantage of this.
For example, whales usually buy at resistance areas and sell on rebounds, which triggers stop losses, causing price fluctuations, and many traders lose their positions in the process. Or whales will continue to push prices down during consolidation to accumulate lower positions and manipulate future prices after completing the accumulation.
For another example, whales may also use FVG (Fair Value Gap, fair value gap) to create some price imbalances, and making up for any imbalance can bring them profits. Simply put, FVG can be a price impulse in any direction, resulting in significant price changes. That is, when one party pushes the price sharply in an instant, and the other party fails to respond in time, an under-trading area is formed. .
In short, in a cycle, whales will try to manipulate the market in various ways, with the aim of constantly forcing the leeks to fall into various trading traps.
Sometimes the market is like a balloon. Although it often gives you the feeling that it is about to burst at any time, don't forget that the balloon can be stabilized by continuous expansion and deflating. The key question here is that no one knows the specific limit of the balloon. What you need to do is to try to gradually exit every time the balloon expands to its maximum volume.
If we take a brief look back at the past crypto bull markets, we can find some interesting phenomena. The bull market in 2017 was called the tulip bubble by many people. The bull market in 2021 made many people see their dreams, and many people really believed that blockchain could change the world. But in this round of bull market (2025?), the situation has become completely different, and due to the participation of Wall Street, many people seem to think that the crypto market has become another US stock market.
But whether it is the crypto market or the US stock market, what we need to do is to understand some of the potential rules or problems as much as possible. For example:
From the perspective of leverage: Usually, excessive leverage often leads to forced liquidation and market crashes, and the resulting unpredictable risks may trigger a cascade effect. Therefore, before the market re-enters a new round of rise, the risks here need to be removed, and this process often triggers large-scale portfolio de-risking and puts over-leveraged investors in a desperate situation.
From an asset perspective: Bitcoin is currently highly linked to the US dollar. In a sense, holding Bitcoin means holding US dollars, which can be used to buy things all over the world. Therefore, we will also find that many large multinational companies have added Bitcoin (including Bitcoin ETF) as an important asset of the company. Even many people describe Bitcoin as digital gold, so it can be foreseen that Bitcoin may have a certain connection with gold in the future.
If you can hold 1 Bitcoin now, it means you have outperformed many ordinary people in the world. And if you can always hold 1 Bitcoin, you will definitely outperform many ordinary investors in this field in the future.
I remember I mentioned before that if you are not a professional trader, then try to avoid frequent swing trading, because your personal feeling or level is difficult to compete with professional traders. If ordinary people want to gain something in this field, the only thing they can use is to grasp the rules of the big cycle and then add their own patience. Moreover, we don’t actually need to defeat whales, as long as we defeat more than 90% of ordinary leeks like ourselves.
I remember that in January of this year (2024), it took about two weeks for Bitcoin to fall from $46,000 to $39,000. During that period, I received a lot of messages, and many of them were similar to the questions I have received in recent days. Many friends also lost their chips because of panic at that stage, and then watched Bitcoin rise all the way to $73,000 in less than two months.
Although pullbacks like this happen every cycle, it seems that many people choose to throw away their chips out of panic during the pullback. The same story is always repeated over and over again. Maybe this is how market psychology works.
Compared with the rise in Bitcoin prices brought about by the BTC ETF narrative, due to the insufficient possibility of capital inflows into the ETH ETF and the FUD (Fear, Uncertainty, Doubt) caused by the current stagnation of the market, we may not see too obvious growth changes in the next 1-2 months, and it is likely that consolidation will continue.
But I still say that I am still optimistic about the long-term market development. And as far as altcoins are concerned, judging from the on-chain data, the overall performance of altcoins is now comparable to that of November last year (2023), which also indicates that there is still a chance for the arrival of a new round of altcoin season. As shown in the figure below.
In addition, from the perspective of the BTC.D index, since April this year, BTC.D has been consolidating between 54% and 57%. At present, this range should be a relatively reasonable position. Once it starts to fall below this range, perhaps we can usher in a new round of copycat season. As shown in the figure below.
Of course, the core issue mentioned in the previous article is still the same: with insufficient new liquidity injection and a large number of new projects in this cycle, not all altcoins have the opportunity to usher in a new round of increases. If you want to re-position now, the best option is to narrow the scope as much as possible and focus mainly on projects with greater narrative (storytelling) prospects.
As for the issue of project selection, I recently discovered a new point of view that many people seem to have begun to deny the rule of "speculating on new rather than old". I am not going to debate whether new or old is better. All I want to say is that everything is dialectical. If you always like to think about problems from a single dimension, it is easy to fall from one extreme to another.
The rule of buying new coins instead of old ones does not simply mean that you should only buy new coins and not old ones. The original meaning of this rule is that old coins are usually held by a wider range of people and are therefore less susceptible to price manipulation. Most of the circulating supply of new coins is usually allocated to specific groups of people or groups, so prices are more easily manipulated.
If the manipulators target old coins, then in order to influence the price, they need to create or take advantage of a depressed market (or directly take advantage of the bear market cycle) to recover these coins from the market, which is difficult and time-consuming. But if it is a new coin, it is easy to achieve short-term manipulation. Therefore, this is a two-way problem, depending on how you view and use it. If you can follow the manipulator's thinking, then you can get the soup, otherwise you will be cut off.
Let’s take the recent popular STRK and ZK projects as examples. Although these have carried out large-scale airdrops, you still need to think about a few questions:
- Are airdrops always distributed fairly? Many tokens may be airdropped to certain wallets!
- The tokens were sold off as soon as they were launched, so the price performance was not very good. After STRK was launched, the price dropped from $2.7 to $0.6, and ZK dropped from $0.28 to $0.15. There even seemed to be various unlockings. But have you ever thought about who took the opportunity to sell off a large number of tokens in the market at a low price? Are all the sales really taken by retail investors?
Of course, it is difficult to figure out the above questions, or even impossible to verify them, but this should indeed be a way of thinking for us. Therefore, if you still want to participate in altcoins, you might as well think about it from the following perspectives:
If you want to trade old coins, try to find those that have been continuously traded during bear markets or consolidation periods and accumulated by big players;
If you want to trade new coins, try to find coins where big players have taken or bought up most of the supply after the token is issued (not before);
Regardless of whether it is an old coin or a new coin, it is best to have room for speculation. The so-called speculation is to make most leeks understand and believe (or directly convince you with the price increase), such as AI and RWA, which are actually narratives that are easier to hype.
The STRK and ZK I mentioned above are just examples, not specific investment advice. But if you can find tokens that meet the above conditions, you may increase the success rate of your investment. The next thing is your mentality. Don’t be scared by the current so-called negative factors. Instead, you should pay attention to new market drivers, such as:
- ETH ETF approval progress (ETF S1 form approval)
- Policy trends in the US (November presidential election and Trump’s support for cryptocurrencies)
- Expectations of the Fed’s interest rate cut (US CPI data will be released on July 11. Will there be at least one interest rate cut before the end of the year?)
- FTX may repay $16 billion to creditors (money continues to flow into crypto markets and bring positive sentiment)
Then you need to plan your position management reasonably, control risks, and give priority to DCA strategies for layout. In short, investment is a long-term thing. It is not a 100-meter sprint, but more like a long-distance race. Only when you reach the finish line at the end of the cycle can you be the real winner.