The significant drop after the interest rate cut meeting mainly stems from Chairman Powell's surprisingly hawkish remarks. The hawkish tone has directly crashed global markets, not just the crypto space, but also led to a substantial correction in US stocks. The crypto market is currently at relatively high prices, with strong bullish sentiment and a lot of leverage, making the drop somewhat expected!
Regarding future speech attitudes, the possibility of interest rate cuts has become an uncertain variable, and we still need to rely on economic data for decisions. Market performance is a short-term negative, and such significant impacts will gradually be digested over time. In the short term, as long as we maintain the 9.8 position, the overall upward trend remains intact. Treat it as a healthy pullback in the short term.
Looking at Ethereum, it typically follows the decline but not the rise, somewhat like an unhelpable figure! Ethereum's price has always experienced significant fluctuations, and this year's retracement has not been an isolated incident. The critical position for Ethereum remains around 3500. As long as it does not drop below this level, it represents a very good short-term buying point!
As for the altcoins, An An is launching new projects too quickly, and funds are unsure how to choose. The first moments when new projects go live are often about crashing prices to harvest gains, which is perplexing. Even when Big Brother was locked up, it wasn’t like this. Why is it different now that he is free? Is An An running out of money?
Every significant pullback is an opportunity to replenish and add positions. Seizing these chances sets you apart from most people. Opportunities are reserved for those with patience; the market always gives signals before rising. Christmas is approaching, and once the holiday is over, the market will eventually return to the familiar state!
Next, there are only the illiquid Christmas and New Year left. Be patient and wait for the bottom-buying opportunity!
As for what to buy at the bottom, look for previous strong narratives that haven't been realized. I'm optimistic about the market after Trump returns to power from January to March next year. If you seek stability, focus on ETH, BNB, and SOL. For a more aggressive approach, consider ACT and PNUT.
For a stable build, meme coins like DOGE, PEPE, WIF, and FLOKI can be chosen. For public chains, opt for some well-established ones with good traction, like APT, SOL, and SUI. In the AI sector, choose FET, including WLD, but I’m more optimistic about FET due to the collaboration with DWF, making it less likely to have a poor performance.
In the DeFi sector, aave and comp should still be the primary considerations. We have zero-cost positions in these. For those wanting to re-enter, wait for lower levels. Furthermore, MKR itself is not problematic; it was just affected by Ethereum. If there are no stop losses, you can hold normally while controlling your position and avoiding contracts.
As for position sizing, it depends on everyone's habits. Of course, Lao Yao also suggests everyone to arrange it reasonably. If your allocation is insufficient, you might as well pick a portion from the above sectors to lay out. As long as the fundamentals and projects are still operational, time will provide answers and some wealth.
Additionally, although the drop in the early morning was significant, the performance data of ETH ETFs still gives us confidence to see the upcoming craziness. Despite the negative news surrounding renowned brands, we observe some data flowing out. However, BlackRock alone has seen an inflow of 80.7 million, single-handedly supporting the overall net inflow of the ETH ETF. While others are cutting losses, BlackRock is buying the dip.
Therefore, whether ETH breaks its historical high, surpassing 5000 or 8000, it's only a matter of time. The storyline is identical to BTC. BlackRock's CEO is personally supporting it, which indicates a long-term plan behind this strength. We must have confidence.
For ETH to rise next, it still needs to break through the previous trendline at 3850. Only when it effectively stabilizes and gains volume at this position can we expect to see higher Ethereum prices!
Moreover, in January, there are still FTX compensations, amounting to 16 billion U or fiat currency this year, which will somewhat flow back into the crypto circle. Coupled with the resumption of the US ETF, the market outlook is still worth looking forward to. Now is not the time to exit.
I've mentioned before that every major drop is a great opportunity to enter, and today is no exception. We are in a bull market cycle, but this year's market characteristic is fast and decisive. The rally is quick, and the sell-off is also swift. Without innovation or new narratives driving it, sustaining the market is challenging. Everyone needs to adapt to this rhythm.
