The model is based on the BTC.D (Bitcoin Dominance) model, providing an intuitive perspective for understanding the trends and trading strategies of the altcoin market. The following is a detailed analysis of its logic, market phases, and operational recommendations:

1. Logical Basis of the Model

BTC.D reflects Bitcoin's share in the entire cryptocurrency market, and changes in this ratio are closely related to the performance of the altcoin market:

  • When BTC.D rises, Bitcoin dominates the market, and the market share of altcoins shrinks, with prices generally falling.

  • When BTC.D falls, it indicates that funds may flow from Bitcoin to altcoins, providing an opportunity for altcoins to rise.

The essence of this model is to reflect the dynamic flow of market funds, which has a strong guiding role for short-term and medium-term investment decisions.

2. Current Market Positioning

According to the content, the current model is in the washout phase:

  • September 2023 - March 2024: Altcoins rose significantly, attracting a large number of retail investors.

  • March 2024 - October 2024: The market underwent severe adjustments, with altcoins generally retracing, leading to significant losses for many investors.

  • After November 2024: BTC.D reaches a new peak, with signs of renewed activity in altcoins, currently moving towards the fourth area, which is the peak stage of the altcoin season.

This description indicates that the market is approaching the next wave of altcoin rising cycles, but has not yet reached the end, so there may still be fluctuations in the short term.

3. Analysis of Operational Strategy

The author provides a model-based operational strategy:

  • Level 2: Plan to sell 75% of the position to lock in most profits, leaving a small position to bet on market tail.

  • Level 3: Marks the end of the altcoin seasonal bull market, recommending a complete exit from the altcoin market.

This strategy aligns with the principles of prudent investment, namely gradually reducing positions at market peaks to avoid letting greed lead to profit loss.

4. Potential Controversial Points

  1. Applicability of the Model
    Although the BTC.D model has been effective in past bull and bear cycles, future markets may change due to external factors (such as the macroeconomic environment and regulatory policies), and relying solely on the model may have limitations.

  2. Impact of Market Sentiment
    The rise of altcoins is usually accompanied by high market sentiment. Although the model shows potential for future growth, whether it can truly erupt depends on whether market sentiment can be ignited.

5. Risk Warning

  • Short-term Volatility Risk: The current market has not fully entered the rising phase and may still face severe fluctuations in the short term, so cautious operation is advised.

  • Impact of External Events: Changes in the macroeconomic environment or the introduction of regulatory policies may lead to model failures or unexpected market fluctuations.

Summary: Cautiously optimistic, gradual operations

At the current stage, based on the BTC.D model, the altcoin market is approaching the next round of rising cycles, but has not yet fully erupted, and there may still be fluctuations in the short term. Therefore, investors can adopt strategies of building positions in batches and gradually reducing positions while closely monitoring changes in BTC.D and market sentiment to flexibly respond to potential risks and opportunities.