Author: CryptoAmsterdam
Compiled by: Deep Tide TechFlow
1. When will the altcoin season arrive?
I believe the altcoin season will arrive soon, and here are some key analysis points:
1.1 The cycle is divided into two stages.
Stage 1: Bitcoin's price rises, altcoin prices fall (Bitcoin's market share rises).
Stage 2: Bitcoin breaks historical highs, altcoins begin to enter a rapid rising phase.
The following chart provides a clearer view of this pattern:
At this stage, we start accumulating altcoins when the total market cap of altcoins is at a low point in the range. I believe that altcoin prices will break new highs just like Bitcoin.
Currently, Stage 2 has been initiated!
For more details, please see: link.
1.2 Capital flow patterns.
The starting point of the bull market can be traced back to the end of 2023, when Bitcoin rebounded from the bottom, returned to the range, and rose to previous highs, while altcoins depreciated against Bitcoin, causing Bitcoin's market share to rise.
When Bitcoin breaks historical highs (i.e., the current stage), capital begins to flow into large-cap altcoins. From the Total 3 (the total market cap of the top 100 altcoins minus BTC and ETH) chart, although it is currently driven mainly by large-cap coins (like XRP), small and mid-cap coins are also catching up.
Ultimately, capital from Bitcoin and large-cap coins will gradually flow into small and mid-cap altcoins.
As market sentiment rises, investors become greedier and start chasing small and mid-cap altcoins. I expect that mid-cap altcoins within 'Others' will reach new highs. The real altcoin season is still ahead.
1.3 Bitcoin Market Dominance.
Every cycle has similar patterns: when Bitcoin's price breaks previous highs and first surges, its market share begins to decline.
Currently, Bitcoin's market share has broken a rising trend that lasted over 800 days.
1.4 ETHBTC trend analysis.
In every cycle, Ethereum tends to perform weakly in the early stages (Bitcoin rises but remains below previous highs), and then begins to rebound when Bitcoin stabilizes above previous highs.
The current cycle is no exception. More funds are expected to flow into Ethereum ecosystem tokens, on-chain utility tokens, and high-risk tokens. Once ETHBTC truly enters an upward trend, these tokens will perform even better.
ETHBTC chart analysis.
Currently, ETHBTC has retraced and has once again settled above the range low.
In late 2021, we failed to break the resistance level of Stage 4. Will we see a 'super rally' in Stage 5 during this cycle?
If it breaks the current downtrend line, it will end a bear market trend that has lasted for 1100 days.
In addition, 2024 is also an important year for the launch of Ethereum ETFs (exchange-traded funds), and I believe the market still underestimates Ethereum's potential.
2. Have you already missed the opportunity?
As mentioned earlier, the Amsterdam team has been accumulating altcoins during the Total 3 market cap lows over the past 5-6 months.
At the range lows, it is advisable:
Buy at key support levels;
Gradually build positions during slow oscillating markets, rather than chasing prices;
Set clear stop-loss points (e.g., below the range);
The market fluctuates less, making it easier to hold positions.
But if you choose to buy after prices have vertically risen:
You may not have a clear stop-loss point. While this may not significantly affect short-term traders, it increases risks for long-term investors without a stop-loss point.
The profit opportunity from the range low to high has disappeared, and the current bet has turned into whether the altcoin market cap can break new highs.
Buying during rapid price increases can expose you to higher market volatility, and 20-30% pullbacks are not uncommon.
So, I think it is not too late for you because:
Bitcoin still has room to rise.
Capital rotation has not yet fully reached the small and mid-cap altcoin stage (the 'Others' chart shows it may reach new highs), so the most profitable stage has not yet arrived.
Bitcoin's dominance may further decrease, while the ETHBTC ratio will rise.
But please note the following points:
Understand the stage of the current market cycle.
Clarify whether you are entering a cryptocurrency for short-term trading or long-term investment.
Develop a clear profit plan.
Understand that this is a high-volatility stage, and rapid declines of 10%-30% may occur.
Accept that these rapid declines are difficult to predict; if you attempt to operate on these pullbacks, you may undermine a longer-term investment plan.
Risk analysis for entering this stage (as opposed to entering in the past 3-6 months):
Please refer to this.
3. Recommendations for entry:
If you missed the accumulation phase in the past 6 months, first think about why you missed it.
It is likely because you are influenced by emotions:
In a bull market, prices usually rise very quickly, with almost no obvious and sustainable pullbacks.
Many people miss out on opportunities to rise, and when they 'fear missing out' and chase prices, the market often enters a consolidation or rapid decline phase.
During the consolidation, they become pessimistic again, ultimately missing out on the opportunity for a quick rise.
The correct strategy is: build positions gradually during consolidation or pullback phases, and remain patient, focusing on the market structure over longer time frames.
For more information, please refer here.
Next are the specific suggestions!
Suggestion 1: Stick to spot trading and avoid leverage.
Prioritize spot trading.
Many people are accustomed to using leverage, but it is actually a trap. Every market fluctuation feels like an 'opportunity', but most of the time it is not. You do not need to rush to act. Leveraged trading will ultimately lead to losses or even zero for most people—do not let it ruin your bull market gains.
Stick to spot trading, so that you won't be unable to hold positions due to excessive leverage, or worse, face forced liquidation and miss market opportunities.
Trust me, stay away from leveraged trading.
Suggestion 2: Don't chase the price up, focus on the pullbacks.
Most people trade based on emotions, buying only when prices rise (green candles) because it makes them feel 'safe'.
But the market will not rise straight up; even in a bull market, there will be pullbacks:
Daily fluctuations: small pullbacks of a few percentage points.
Every few weeks: panic sell-offs of 10%-30%.
If you buy when prices are rising, you are likely to sell in panic during pullbacks.
Buying during rises will feel reassuring.
Selling during declines will feel relieving.
But the correct strategy is:
Buying may make you feel scared, but this is the right time.
Selling may make you feel reluctant, but this is a rational choice.
If you can operate against the trend, building positions during pullbacks and boldly buying during panic sell-offs, you will have an advantage over most people.
Suggestion 3: Build positions in batches and operate patiently.
So far:
Only choose spot trading.
Do not chase prices; rather, build positions during pullbacks.
In addition, you do not need to invest all your funds at once.
You can choose to build positions gradually. If prices drop by 5% and you invest all your funds in altcoins at once, then if the market undergoes a larger adjustment (like a drop of 10%, 20%, or even 30%), you may panic and sell.
The correct strategy is: invest 10% of your funds when prices drop by 5%. This way, when a larger pullback occurs later (e.g., 10%, 20%, or 30%), you can continue to add to your position gradually, rather than being shaken out of the market by fluctuations.
What if the pullback does not deepen further? That's okay. Do not invest all your funds at once due to fear of missing out; that could force you out during a deeper pullback.
There will be more pullback and position building opportunities in the future.
In a highly volatile market, you cannot perfectly capture every fluctuation. You also do not need to buy at the lowest point or sell at the highest point; just focus on long-term gains.
Suggestion 4: Manage risks and avoid excessive risks.
You may have heard those legendary stories of 'going all-in' and making millions, but excessive risk-taking will greatly test your psychological endurance. If your position is too heavy, you may be forced to sell out of panic during market corrections, ultimately missing out on greater opportunities.
Suggestion 5: Develop a plan that suits you.
Do not directly apply someone else's plan; instead, develop a clear investment plan based on your own goals and risk tolerance. This plan should include risk management and multiple coping strategies in case the market trends do not align with expectations.
A good plan can keep you calm during market fluctuations, help avoid making wrong decisions due to panic or excitement, and assist you in gradually achieving profitable exits.
The following points need to be clarified in the plan:
Keep it simple: do not make the plan overly complicated.
Focus on long time frames (HTF): pay attention to the big trends rather than short-term fluctuations.
Clarify your goals:
What market signals do I want to see?
Which tokens do I want to invest in? Why did I choose them?
How much capital do I plan to invest?
In which price ranges will I build positions in batches?
When will I exit?
For how to formulate a periodic profit plan, you can refer to this tweet.
Suggestion 6: Focus on long time frames, keep strategies simple.
Focus only on long time frame (HTF) charts, avoiding disturbances from short-term fluctuations.
You only need to focus on key price ranges and market structure, without worrying too much about market noise.
Keep strategies simple and clear.
Even simple strategies can give you an advantage in the market:
Most people use leveraged trading, but you do not.
Most people chase prices when they rise (green candles), but you do not chase prices.
Most people do not have a clear profit plan, but you have your own plan.
Most people buy or sell all at once, but you choose to build positions and exit gradually.
Before sharing my altcoin observation list, let’s discuss an important point:
Opinion:
Currently, altcoins ('Others' market cap) are expected to reach new highs and attract capital inflows from Bitcoin and mainstream cryptocurrencies.
Currently, the 'Others' market cap is slightly above the median of the range and is gradually approaching the high of the range.
It is important to note that the high range is typically a strong resistance area, and there may be multiple tests and pullbacks before a breakout. When the market is performing strongly (like today with a lot of 'green'), this point is often easily overlooked.
Recall Bitcoin's performance before breaking above the range high: it underwent multiple pullbacks and consolidations before successfully breaking out.
Even reviewing the last bull market cycle, at the beginning of the altcoin season, the 'Others' market cap chart also experienced a significant pullback of 30% before breaking the range high.
So please remember the following points:
Before the full altcoin season arrives, the market may experience significant pullbacks, and there could even be weeks of declining trends.
But don't try to predict these pullbacks and wait, instead, adopt the following strategy:
Gradually build positions in batches: increase your holdings step by step, do not invest all funds at once.
Avoid using leverage: leveraged trading is extremely risky and can lead to forced liquidation.
Buy during pullbacks: focus on building positions when the market is declining (red candles), rather than chasing prices when they are rising (green candles).
Be patient, follow long-term strategies, and you will be more likely to profit amidst market fluctuations.
$SOL
SOL is currently a strong performing large-cap coin, showing clear advantages in this market cycle—this is a choice worth paying attention to.
From the perspective of the market cycle, I expect SOL to break through the current range high and have significant upward potential as prices enter the 'discovery phase' (i.e., when prices reach historical highs and the market explores their true value).
Currently, it is possible to consider building positions in batches at this stage, but it is important to note that the current price is in a resistance area at the high range. If you buy in with all your funds at once, you may find it difficult to withstand a potential future pullback of 10%-30%. Therefore, it is advisable to strictly follow the batch building plan.
Additionally, it is recommended to use spot trading and avoid leveraged operations. Here are my operational thoughts:
Wait for prices to break above the range high before starting to build positions gradually.
If prices continue to rise and stabilize at a high level, you can continue to add positions in batches.
If prices fall below the range and then break out again, this presents another opportunity to add to your position.
If prices retrace back to the previous consolidation range, it can also serve as a timing for building positions in batches.
When prices rise again after a pullback and break the short-term downtrend line, it can also be considered an opportunity to add to your position.
In summary, develop a clear response plan for various possible market trends, and gradually build positions through spot trading.
2. $BLUR
BLUR is a relatively unique cryptocurrency. Earlier this year, it failed to hold the Stage 4 range low (i.e., the price support in the low area), which may have been due to the overall slump in the NFT market at that time.
Today, the NFT market is recovering. Opensea may launch its own token, and Magic Eden's token will go live next week.
Driven by these positive events, combined with the current market and chart performance, BLUR may regain market attention.
My main observation point is: when prices regain the range low (marked by arrows on the chart), will there be an opportunity to build positions?
If the market declines again, you can also try building positions at the range low of Stage 3.
However, for me, this cryptocurrency is more suitable for short-term trading rather than long-term holding.
3. $MEME
Even ordinary investors have heard of the meme-themed investment cycle. I find it hard to imagine that a token named 'MEME' would not attract widespread attention in the market after being listed on all top exchanges.
The price structure of this token is very perfect and is currently in Stage 3. I will wait for prices to clearly break out and reclaim key positions before entering.
In addition, this token is associated with a large NFT series. With the recovery of the NFT market, the implementation of the $ME incentive program, and the potential launch of Opensea's token, it may gain further upward momentum.
4. $ORAI
$ORAI is a veteran AI token. Last week, it successfully reclaimed Stage 4 (the orange area) in a short cycle market structure, which is why I bought back some positions.
If prices again retrace to this range, I will continue to add to my position.
In addition, I have also set price alerts for when it forms a breakout above the macro range low, which will become a new entry signal.
5. $TIA
Since TIA reclaimed and retested the range low, I have been holding it.
Currently, it is trying to break through the current price structure. I believe that if prices establish a clear breakout above the gray area, subsequent pullbacks will be a good opportunity to add to positions.
