BTC continues to fluctuate in the market. The so-called fluctuating market means there is no stimulating trend sentiment, no strong liquidity, and the market is only slightly influenced by emotions, oscillating between 92,000 and 98,000. Once the sentiment is good, it will rise above 98,000; once the sentiment is bad, it will drop below 98,000, currently grinding back and forth around 94,000.
Currently, Bitcoin is experiencing a decline with decreasing trading volume, indicating that the selling pressure at this level has weakened, and the downward momentum is losing strength. The room for further decline in the short term is limited, and the probability of a rebound is relatively high. The rebound may not exceed $98,000, and after the rebound, it might oscillate at a low level for a while, with a risk of a deeper decline still existing in the short term.
Additionally, there is news today that the U.S. Department of Justice has been authorized to sell seized Bitcoin related to the Silk Road case, valued at $6.5 billion.
Many friends are worried that this batch of nearly 70,000 BTC entering the market will lead to a crash, but in reality, the U.S. Department of Justice's past methods have always been to sell through OTC, such as the 50,000 BTC obtained from a hacker attack in 2023, which was sold in batches OTC. Furthermore, as early as 2014, 29,000 BTC from Silk Road was auctioned off. It is almost never directly dumped in the secondary market.
From the currently known U.S. holding data, it appears that not all has been sold. In fact, it may not have started selling yet. This is because the Department of Justice has not updated any selling information. If they had sold, it should have been announced, so it’s not a big issue. Many negative news will come out during market declines.
Speaking again about altcoins, this round's hellish difficulty means that even long-term players who have always been the ultimate winners will be completely in the dark if they don't choose the right coins, regardless of short-term situations.
Investors who can persist through the current phase undoubtedly possess a will as strong as steel, just like the kind that makes a sound when passing through a security checkpoint! However, the real climax of this round of altcoin season has yet to arrive, and it is expected to undergo at least six months to over a year of tempering before the frenzied altcoin season can truly begin.
Currently, we are still in the early stages of the interest rate reduction cycle, and the transmission of liquidity is not instantaneous; it takes time to gradually penetrate. This process can be extremely simplified to: the U.S. lowering interest rates leads to an increase in the money supply, which in turn triggers a surge in liquidity across capital markets. As everyone has more funds available, expectations for the future economy will gradually improve, leading to more capital flowing into high-risk asset areas, driving their prices skyrocketing. Ultimately, we will see liquidity gradually overflow from low-risk assets, permeating layer by layer into high-risk assets.
However, this transmission process occurs over quarters or even years, and will not be too rapid. Therefore, if I were to estimate based solely on intuition, we might need at least another six months to over a year to witness this transformation.
How should we layout now?
1. Do not touch new coins in the secondary altcoin market.
You can refer to this standard to match the most blue-chip altcoins that have gone through at least one cycle, and do not FOMO. Be patient and wait for the right buying opportunity. Once you catch it, pull the trigger decisively and then wait for the flowers to bloom.
2. Use a small amount of money to engage in this area with the most abundant on-chain liquidity to seek alpha returns.
Base and Sol are both good starting points; you must learn. If you want to play memes, never directly engage in the secondary market. First, come on-chain to feel the rhythm of memes. If you haven't played on-chain, jumping directly into the secondary market is a certain death. Investing is a game that rewards those with patience; have more patience, my friend.