At the end of the last two weeks of 2024, the market experienced a relatively large correction. After the strong bear weekly candle closed on December 23, the following week saw a buying force pulling back to avoid a panic, although the selling force still prevailed.
Before the closing of the December monthly candle, the buying and selling forces were still relatively balanced. The current market remains unpredictable as I previously forecasted.
The 1-day candle looks more optimistic, as the price $BTC still sits above the strong support of 90,000. However, the sellers have not yet succeeded in pushing the price to the upper bound. The daily frame also shows that BTC is in a stable state waiting for the next macro news and the market trend in the early days of 2025.
Regarding BTC.D (Bitcoin dominance index), the weekly frame shows signs of testing the 60% range and adjusting immediately upon reaching it. At the time of writing this article, BTC.D is around 57.8%. In my opinion, in the short term, BTC.D may still test up to the 58.5% range before creating a bearish divergence and gradually declining, making way for Altcoins (this process may occur this week).
If this scenario occurs, Altcoins will welcome a big wave starting from the 2nd or 3rd week of 2025. However, if BTC.D shows no signs of bearish divergence and continues to rise to about 60%, then Altcoins may have to wait until after the Lunar New Year.
Another noteworthy sign is that the USDT.D index (the dominance index of Stable coins) continues to stabilize in a downtrend (both daily and weekly frames). This index indicates that there is no major sell-off from Bitcoin or Altcoins. But...
According to last week's statistics, the net amount of USDT withdrawn from ETH network exchanges was over 316M USD. Currently, we cannot be sure whether the decrease in USDT.D is due to investors bottom-fishing (the price of Altcoins or BTC remains relatively stable, with no breakthroughs), or due to a large amount of USDT being withdrawn to cash, leaving the market (this scenario is very bad, potentially signaling a downtrend).
A concerning indicator that clarifies this bad scenario is that the total USDT market cap shows signs of decreasing in both the weekly and daily frames. I hope this decrease is only due to Europe refusing to trade USDT and not because money is flowing out of the market; we need to observe further.
The TOTAL 3 charts (total market cap excluding BTC, $ETH ), OTHER (Market cap of altcoins excluding top coins), and OTHER.D are moving quite similarly, just testing the peak and showing a slight short-term correction trend, with no clear signs or trends, so I won't analyze further.
What is the best scenario for the market in the first weeks of 2025?
Currently, we do not expect $BTC to pump past the peak immediately, as BTC.D would then be sucked back in, and Altcoins would bleed again. In recent days, when BTC was fluctuating, we saw Dom showing signs of releasing in short bursts, many Altcoins have managed to escape the bottom, and the bottoms have gradually been pushed higher. Even at certain times when BTC dropped, Altcoins rebounded quickly as BTC.D was not at an excessively high level anymore.
Therefore, what those holding Altcoins need is for BTC to continue to fluctuate, even accepting some light corrections for BTC.D to gradually decline. Consider adding more if there’s still money when BTC.D tests back to the 58.5% range; there may be risks, but not much. If BTC.D drops below 56.3% while the Altcoin price I want to buy has increased, I may also consider adding more to catch a big wave.
Additionally, what needs to be observed further is USDT.D, USDC.D; in case USDT.D decreases and USDC.D increases, then the bad scenario does not occur, but it is just users switching between stable coins. However, when both of these indices decrease sharply, in my personal opinion, it is advisable to take profits, cut even, or even cut losses.
Regarding the trend of Altcoins, I do not shill any specific projects to avoid unnecessary debates. But still the old advice, those tokens that have been heavily pumped recently, and new listings should not be overly fomo. The last wave has passed the trend of memecoins, then to old coins and top coins. If you want to place a small bet, look for tokens that have not broken the accumulation range in the weekly and monthly frames, which have not seen a pump since listing.
In any case, do not let your account run out of funds; the market is not short of opportunities, so don’t rush. And one thing to remember, unrealized profits are not guaranteed profits; taking profits while the money sits on the exchange does not mean that money is truly in your hands.
This season is no longer like previous seasons, so the hold to the moon strategy seems outdated; set realistic target expectations, and cut losses with real discipline.
