Bitcoin has not yet broken the support level around 92,000, but altcoins continue to decline, especially Ethereum-related coins, including the previously surging meme sector. For memes, which saw a significant rise, it is normal to experience greater selling pressure during a pullback due to the high gains. Accepting high gains means enduring more volatility than other altcoins.
Currently, it can be said that altcoin bulls are in a moment of despair. In December, Bitcoin reached new highs while altcoins did not follow. When Bitcoin corrected, altcoins plummeted, and in January there was barely a rebound of less than a week, crashing back to the bottom within 24 hours.
Many people may doubt whether there will be an altcoin season; this anxiety is very normal.
The next opportunity is likely that the US and UK central banks will implement bond repurchases, releasing liquidity into the market. Positive data in January and confirming rate cuts in March, along with Trump's policies, will be essential to boost altcoin liquidity. The market currently appears very pessimistic, but often, extreme panic is when a turning point arrives.
At this stage, we are in a volatile market without trend sentiment stimulation and strong liquidity. The market is slightly influenced by sentiment, oscillating between 92,000 and 98,000. If sentiment improves, it could rise above 98,000; if sentiment worsens, it might drop below 98,000. Macro-wise, we continue to wait for tomorrow's unemployment rate and non-farm data. As long as there is no hype about recession expectations, there is still something to watch. Even if there is hype, it might look grim for a few days, but with Trump approaching, expectations remain.
The biggest news today is that the US Department of Justice has been authorized to sell 6.5 billion dollars' worth of Bitcoin from Silk Road.
Let's interpret this news. Currently, there are two possibilities in the market. One is that this news was already sold on December 30, and this event has fully reflected in the price since the approval was given on December 30.
The second point is that they might engage in OTC trading, which does not affect the market.
Let me share the Crab Boss's viewpoint: right now, it has only been approved, and it is still uncertain when these Bitcoins will be sold. There are only 11 days left until Trump takes office, and he has previously stated that he would not sell a single BTC. Given the efficiency of Americans, we still need to observe whether it can be sold smoothly.
Secondly, if they do sell, 6.5 billion dollars' worth of BTC isn't much, as companies like BlackRock and MicroStrategy have infinite capital. It is estimated that they will recover it in a few days, so I believe this news is influenced more by sentiment.
Regardless, since November, BTC has led the market, and ETH has also started moving, but the rise has not been significant enough to create sufficient FOMO. Secondary altcoins are watching ETH closely. From the main upward trend in 2020-2021 to now, we can observe ETH's daily line rising from 3,050 to over 4,000 dollars from November 21 to December. At the same time, most secondary altcoins also rose during that period. Looking at this month, on January 1, ETH rose from 3,300 to around 3,700. Those who are attentive can observe and pick a few projects in each sector.
For secondary altcoins to explode, we still need to expect BTC to drive FOMO. ETH has enough momentum to push the market. The good thing is that since the elections began in November, ETH has indeed been rising, and the inflow of ETH's ETF is also quite good compared to before October 2024.
The Ethereum exchange rate deserves special mention. Since November 10, it has formed a large oscillating triangle. Just yesterday, it touched the lower edge of the oscillating triangle, which may lead to a rebound.
Ethereum and altcoin investors should seize this window period. Bitcoin is weak, which is almost a given, and this is the best time for Ethereum's rate to rise and for Bitcoin's value to plummet. After experiencing three waves of decline, altcoins should also aim to rise now to attract liquidity.
Before there is a substantial volume, the most likely trend is to oscillate first, then gradually increase in volume. Altcoins have already reduced their volumes to the extreme, so there is not much left to wash out.
Next, we await the inauguration of the new president, the inauguration of the new SEC chairman, the launch of ETH's spot ETF staking, and the sentiment around BTC leading the way, with speculation about ETH upgrades in Q1 2025.
Essentially, there needs to be more inflow of funds for ETH. In fact, the inflow of funds for ETH's ETF was quite good during those days around 1.1.
We need to pay close attention to the US non-farm employment data to be released on Friday, as this will affect short-term market sentiment and price trends. This recent decline is likely a risk-averse reaction to the non-farm data. If the non-farm data shows an increase in unemployment and a decrease in employment, the Federal Reserve may open up more rate cuts.
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