Recently, the positive data of the Consumer Price Index (CPI) has brought us good news, indicating that the market is about to usher in a wave of positive market conditions. The rise of altcoins seems to be in sight!
The CPI data released yesterday was 3.4. As we expected, as long as this value is less than or equal to 3.4, the market is likely to rebound quickly. This is indeed the case. Bitcoin has soared from 62,500 to the current 66,500, an increase of more than 4,000 points! At the same time, Ethereum has also climbed more than 180 points from the lowest point of 2,860 to around 3,040. Judging from the closing at 8 o'clock yesterday morning, the market trend is strong, and a large positive line appeared on the daily chart.
In addition to the positive CPI data, the disclosure of the holding of Bitcoin ETF by US pension funds may also become one of the positive factors driving this round of market rebound. But I think an important reason for the current market rebound is that the market has been falling for too long, and it is time to rebound. Yesterday's strong rise in Bitcoin once again hit the exchange rate of Ethereum. From the technical indicators, the current exchange rate is in a severely oversold range. In general, due to the continued weakness of Ethereum, the performance of most altcoins is just following the state, and only a few varieties have gone out of their own independent market. From the trend line, the rising trend line since the beginning of 2020 provides strong support below. Therefore, even if the exchange rate continues to fall, there should not be much room.
Now, the first shot of the rebound has been fired, and we should make a layout at a low level next. Focus on and layout the artificial intelligence sector, the L2 sector of the Ethereum series, and the SOL sector. The release of yesterday's CPI data once again put the expectation of interest rate cuts on the agenda. Coupled with the US election at the end of the year, interest rate cuts are actually logical. Therefore, the probability of early speculation is relatively high. I personally think that the upside of Bitcoin is limited in the short term, so Ethereum may lead a wave of altcoins! At present, more and more institutions or companies have disclosed that they hold Bitcoin ETFs, which will attract more and more financial giants around the world to join the ranks. It is only a matter of time, and it also lays the foundation for the arrival of a big bull market. Only when buyers and sellers fully exchange chips can the market be further pulled up.
Now we need to review and possibly liquidate certain coins. See if your holdings have the following characteristics: First, the venture capital coins. I did not price them correctly two months ago, and the cost of the chips they acquired was much lower than the current secondary market price. Secondly, the volume to be unlocked in the future is too large, and the unlocking method is linear, not step-by-step. Furthermore, there are too many new coins launched by venture capital companies in this cycle. I can't buy a basket of altcoins, and the winning rate of buying in this way is too low. For the new coins launched by venture capital companies, some can be bought, and some cannot be bought. My purchase principle is: buy new coins that have not been unlocked in the next year or so, or buy new coins that have been unlocked in a step-by-step manner, and the time interval between each step is about half a year, such as PYTH.
Based on this principle, you can adjust or check whether the altcoins in your hands have future development potential. If there is no narrative or there is still unlocking in the future, you can consider selling. If there is a narrative and unlocking plan in the future, you can consider holding for a while and selling before the narrative is implemented or before unlocking. Take several altcoins that may be liquidated as examples: IMX, the main reason is that the popularity of games in this cycle is too low, and I think the large-scale games it features are not suitable for the cryptocurrency market. If you look at it purely from a speculative perspective, there are better options. Another one is ENA, which is a rare high-quality venture capital coin with positive returns on its projects, and the returns will be even more amazing driven by bull market sentiment. Although its unlocking situation is not bad, for me, I think there are better options and I may buy it back later.
Let's talk about the logic of buying altcoins: First, give priority to fully circulated altcoins, such as meme coins and inscriptions, which are all fully circulated. The advantage of this is that the market chip cost of altcoins that have experienced consolidation is more transparent. Second, only consider altcoins listed on the Binance exchange, because liquidity is always the first priority. Third, give priority to the leading coins in the hottest tracks in the market. For example, I observed a basket of altcoins for two months, and it was obvious that the solana series performed better. Fourth, it is best to choose a currency with a market value between 100-200. Fifth, the project must have positive returns. Sixth, the market value ranking is much lower than the daily trading volume ranking of the corresponding target, for example, the market value ranks 100th, while the trading volume ranks 50th.
In general, everyone should have a convincing logic when holding altcoins, so that they can withstand the test of market decline and stabilize their mentality to obtain excess returns when the market rises. Everyone must be responsible for their own funds! Back to the market topic, ETFs have returned to net inflows in recent days, and yesterday's inflows increased significantly, which is a positive bullish sign. Taking the above factors into account, we should remain optimistic about the next market trend. The hardest moment is over. In the short term, we need to pay attention to whether the support level near 65,500 can be held. It is best to have a slight shock here to accumulate strength and lay a good foundation for the next wave of rise. The catch is that Ethereum’s trend is still very weak. Judging from the trend, there should be no hope for ETF approval in late May. We can only wait for new hot spots to drive the market of Ethereum.
After a month-long adjustment, Bitcoin rebounded strongly last night driven by favorable macro data. From the current market perspective, a support level has been formed near 60,500 and has been repeatedly verified. It is expected that the market will continue to rise in an adjusted manner in the future. The rebound of altcoins last night was also very strong, which is exactly the importance of May that I mentioned a few days ago. For many investors who have not yet boarded the train, this is a good opportunity. If you bought altcoins a few days ago, you should have made a profit today. As for the performance of altcoins, you can refer to the total market value of all currencies except the top 10. Since April 13, the bottom has been rising, and the overall altcoin market value has actually performed better than Bitcoin. This may be contrary to the intuitive feelings of some investors. The main reason is that the number of altcoins issued this year has increased sharply, which has dispersed the funds of altcoins and caused a serious differentiation in the trend of altcoins, especially a large amount of funds concentrated in the MEME sector. However, the current K-line trend is in a triangular consolidation state and is close to the upper edge of the triangle. If this state can be broken in the future, the overall market of altcoins may be coming.
Recently I have also been ambushing a currency that is about to explode, with a short-term return of 30% and a long-term return of about 5-8 times. As I said before, if you come to me on your own initiative, I will take you ashore and you just lie down.