The 'buy the dip' moment for cryptocurrency will last longer in this cycle

Hedge Fund Founder

A cryptocurrency hedge fund manager stated that after the overall cryptocurrency market plummeted on the daily chart, traders may have more time to take advantage of buying opportunities in this cycle.

Daniel Cheung stated in a post on X on December 9: "There will be volatility within the month, but the pullback may become a 'buy the dip' situation, lasting much longer than everyone expected.

Traders continuously seeking profit-taking

Cheung mentioned that traders have shifted to a 'short-term' trading mentality in this cycle, 'constantly seeking profit-taking.' According to data from CoinMarketCap, the total market capitalization of cryptocurrencies dropped by 5.41% to $3.44 trillion in the past 24 hours. In an article on X on December 9, the cryptocurrency analysis company emphasized that several altcoins that have surged significantly since October 'plummeted today.'

Among the top 100 cryptocurrencies, the largest decliners in the past 24 hours were Kaia (KAIA), down 31.3%; Stellar XLM, down 28.3%; and Flare FLR, down 26.9%.

If retail traders 'panic' and sell cryptocurrencies too quickly, it could trigger a drastic recovery.

"Assets like TRX, AVAX, DOT, ICP, POL, FIL, and TIA are expected to rebound rapidly.

Traders bought heavily leveraged long positions before the crash. Once liquidity in the spot market disappears, they find themselves in trouble."

"Leveraged longs experienced what amounts to a market extinction event in the past 24 hours," he added.

In the past 24 hours, approximately $1.58 billion of long positions in the entire cryptocurrency market were liquidated.

Timing the cryptocurrency market is 'extremely difficult'

"In previous cycles, participants mostly adopted a holding and buying on dips mentality," he said.

"The reality is that timing the market is extremely difficult, and with so many people believing they can predict the 'top' of cryptocurrency, it makes me believe that this time cryptocurrencies will have a longer upward trend than expected," Cheung said.

Analysts recently stated that the drop in Bitcoin prices in the short term may not be as deep as last week's 10% plunge, as selling pressure has significantly eased after Bitcoin first broke through six figures.