There was a negative news in the market today, involving the $6.5 billion of Bitcoin seized from Silk Road, which can be sold on the market. This negative news may mean that the decline is nearing its end. The U.S. stock market is closed today to commemorate former President Carter.
The market looked promising at the beginning of this month, but yesterday there was news that the probability of no interest rate cut in January has risen to 95%. The market now needs to wait for the fundamentals to be confirmed. If there is no interest rate cut in January, there is a high probability that there will be a rate cut in March, and there will be a two-month window in between, during which time institutions and large investors are willing to wait.
Although the macro environment has been adjusted, the fundamentals of Bitcoin and the market are still bullish. From the perspective of capital flow and sentiment, the market is greatly affected by the US stock market, which is the so-called "US stockization". However, according to today's ETF data, BlackRock's capital inflow is close to 600 million US dollars, which successfully saved the situation and made the Bitcoin ETF data positive. This shows that the main capital did not reduce its position due to the decline, but increased its position.
Every decline in the bull market is an opportunity. The target of adding positions should be the leader of each sector, which will rebound the fastest. Popular sectors include AI, DeFi, MEME, etc., but the trend of the secondary market still needs to move forward steadily. There are still good projects appearing in the primary market every day, so you can pay more attention to it in the near future.
Which stage of the bull market are we in now?
From September 2023 to March 2024, we experienced a rapid rise in altcoins. Then, from March 2024 to October 2024, there was a violent correction, and altcoins suffered a certain blow. In November 2024, I mentioned that BTC.D had reached its peak, and the subsequent decline would cause BTC.D to decline, and from then on, altcoins began to recover. Now we are still in a wash-out phase.
What will happen next?
According to the chart analysis, we are heading towards the 4th zone, which is a very important step for altcoins. The low of BTC.D will be the end point of the altcoin's sharp rise. That is, when the model enters the 4th zone, the altcoin will reach its peak. Currently, the model is at 5.27, and to reach the stage of the alt season outbreak, it needs to drop to 2.05, when the alt season will reach its peak. Now we haven't even reached the 1st stage, which means there are still many opportunities waiting for us.
Altcoins are still in the $30,000-40,000 range of BTC, and the market development is completely on track. The important thing is to remain patient and reject the noise. When we reach the second stage, at least 3-5 times the return can be obtained.
Will altcoins explode?
I personally think that there is a high probability that there will not be a comprehensive surge like in 2021.
There are three reasons:
1. The continued lifting of restrictions has led to the continuous unlocking of tokens of low-circulation and high-FDV projects, which has brought about greater selling pressure
2. The excessive growth of the supply side and the improvement of industry infrastructure have lowered the threshold for entrepreneurship, leading to the issuance of a large number of new projects
3. Insufficient growth on the demand side and the lack of eye-catching new business models make it difficult to stimulate demand for altcoins.
Therefore, this round of bull market will not see a surge across the board like in 2021, and the cottage season will only see sector rotation. You need to find targets with high cost performance and a certain amount of luck.
Only when the copycat season arrives can the vast majority of retail investors see a turning point!
Because many retail investors hold altcoins instead of Bitcoin. If there is no altcoin season in this bull market, many retail investors may suffer heavy losses. Therefore, many people's position allocation should be adjusted. It is recommended that the ratio of Bitcoin, value coins, and altcoins should be 5:3:2. Such an allocation will eventually outperform most people.
I believe that the bull market is not over and the copycat season will still come, but the question is: can you survive until the copycat season arrives?