Since last night, the cryptocurrency market has experienced a wave of large-scale liquidations. This tumultuous situation has been exacerbated by the recent price fluctuations of Bitcoin, especially as Bitcoin broke through the $100,000 threshold, triggering a chain reaction of forced liquidations of long and short positions.
In the recent drop, Bitcoin plummeted from a high of $100,000 to $94,000 before rebounding to about $97,000. This sharp decline raised market concerns, especially among those with excessive leverage, as the continuous liquidations further amplified the market's fragility.
The recent volatility of Bitcoin has once again triggered tremors in the cryptocurrency market, leading to liquidations of as much as $1.711 billion within just a few hours. This is the second lightning crash for Bitcoin in the past seven days, exacerbating the chaos in this already turbulent market.
Although the cryptocurrency market has indeed experienced large-scale liquidations, this may indicate a healthy correction after unprecedented growth. However, it also highlights the risks brought by high leverage, often reminding everyone to minimize contract trading and to set proper take-profit and stop-loss levels.
What other highlights are there in the future market?
1. The CX effect continues to ferment; Wall Street capital is lining up to enter, and many traditional Chinese financial companies are also getting involved, so Bitcoin will continue to rise. If you want to buy, don't focus on individual prices; look at the rise ratio. So far, no token has outperformed Bitcoin in the long run.
2. Ethereum still has opportunities; although no groundbreaking announcements are expected in 2025, being able to convince people that making money is the best application, it is the only second candidate for an ETF, the original bloodline of the DeFi sector, having gone through all the bull and bear markets with various applications, with a very strong fundamental, and it hasn't broken its previous high.
3. Future market analysis may not rely on charts and data as before; it will also require reference to policy adjustments from the Trump administration, as well as movements from BlackRock, MicroStrategy, and Grayscale, and pay more attention to the types of tokens held by these institutions.
4. The voting by Microsoft in recent days and Amazon shareholders' proposal to hold a meeting to decide whether to buy Bitcoin are both significant increases. If one of them passes, then Bitcoin still has potential.
5. Each bull market cycle has a new narrative; always stay alert to capture new information. A new narrative can be simply understood as a consensus that this is another breakthrough in blockchain, where money quickly concentrates, creating a strong effect of wealth accumulation, more lasting and larger in scale than memes.
6. It is firmly believed that no one can buy at the absolute bottom, and no one can sell at the peak. Therefore, when investing, don't be biased against a coin simply because its price seems high. Analyze what it will do next, learn, research, and form your own judgment logic to escape before the bull market ends.
In summary, this time Bitcoin, like in the past, took off in October, started to consolidate upwards at the end of November and early December, with too much buying pressure preventing a drop. The story of seeking the sword from the boat suggests that it is very likely to surge again towards $120,000 to $140,000 in January, coinciding with the inauguration dates of Trump and Musk. I believe the probability of this trend materializing is very high.
In the short term, various news will influence the market, such as the meeting tomorrow night where Microsoft, the world's largest company by market value, will discuss whether to invest in Bitcoin. The outcome is unknown; if approved, Bitcoin could see at least a 10% surge, while a rejection might lead to a slight pullback.
Will altcoins have a chance to breathe?
From a trend perspective, market liquidity typically worsens during the Christmas period, so the risk of a short-term pullback should be noted.
Moreover, over the past 11 Christmases, there have been 4 instances of post-holiday increases and 7 instances of declines. There are two key time points before this year's Christmas: the Federal Reserve meeting on December 19 and the Nasdaq 100 index coming into effect on December 20. Therefore, volatility may increase during the Christmas period, especially for altcoins that may not benefit from spot ETF funding, which poses a significant pullback risk, so it is important to manage altcoin positions well.
From the market sentiment perspective, Bitcoin needs to stabilize above the key psychological level of $100,000 to stabilize market sentiment; Ethereum needs to challenge the resistance level of $4,050 again to restore investor confidence. Although the current liquidation ratio of altcoins is relatively high, there may be rebound opportunities after a deep market correction, especially for projects with strong fundamentals and community support.
Short-term operation suggestions:
In terms of operations, if you are more conservative, you might consider taking profits first, at least to break even. In a bull market, greed is not advisable; once the target is reached, take profits in batches.
If you are relatively aggressive, you can continue to hold, but be prepared for significant volatility. You can hold a large position in mainstream coins and a smaller position in some leading projects, leaving some bullets for bottom fishing.
