Renowned cryptocurrency analyst Flow Horse predicts that by mid-January, the prices of Bitcoin and altcoins may see significant increases. This optimism stems from the expectation that the incoming Trump administration will adopt policies supportive of cryptocurrencies, as it has indicated support for reducing government resistance to them. Trump's proposed Bitcoin treasury plan further fuels bullish sentiment.
However, analysts advise caution, indicating that traders may have overestimated Trump's ability to quickly implement these policies. As the inauguration on January 2025 approaches, the initial excitement may give way to a market adjustment.
Potential market peaks and adjustments
Flow Horse emphasizes the possibility of the cryptocurrency market reaching local peaks around Trump's inauguration. He notes that while many investors expect cryptocurrencies to continue rising during Trump's presidency, the market may face challenges, including the reality of a divided Congress.
Moreover, the broader economic situation also presents obstacles. Unlike the 2020 cycle, which was buoyed by low interest rates and stimulus measures, today's market faces tighter credit conditions. Analysts warn that without similar economic support, significant outperformance relative to the previous cycle will require clear growth reasons.
Key points for traders to note
Although there is optimism about the bullish potential of cryptocurrencies, traders should remain vigilant. Market trends depend on various factors, including the implementation of policies supporting cryptocurrencies and broader economic conditions. We urge investors to manage their expectations and prepare for potential adjustments in the coming months.