In the current market of Bitcoin and altcoins, we can observe some unique phenomena. The launch of Bitcoin ETFs has contributed to the continued rise in its price, mainly due to increased demand from institutional investors brought by ETFs, and these institutions usually adopt long-term holding strategies. Against the backdrop of massive ETF inflows, Bitcoin did see a significant rise, which was relatively stable and supportive.
However, at the same time, the gains of many altcoins cannot be ignored. Compared with Bitcoin, altcoins have lower liquidity, and it is easier for dealers to control price fluctuations. They often "pull the market with the trend" when Bitcoin rises, and attract retail investors to follow up through large price fluctuations. This behavior is called "luring more" in the market - dealers quickly raise prices to create the illusion of rising prices, attract investors to chase high prices, and then leave the market at high points to make profits, causing prices to fall rapidly, and investors who follow up to chase high prices will bear losses.
To profit from altcoins, here are a few strategies to consider:
1. Short-term trading and risk control: The volatility of altcoins is extremely high. Short-term traders can enter the market at an early stage of price increase, aiming to make a quick profit. However, this requires very strict risk management. Once signs of dealers selling are found, profits must be stopped decisively.
2. Track market sentiment and hot spots: The rise and fall of altcoins largely depends on market sentiment and hot spots. By observing social media, industry news, etc., knowing which altcoins are being paid attention to by the market can help seize short-term opportunities.
3. Choose projects with technological potential: Although most altcoins are Ponzi schemes, there are a few projects with practical application scenarios or technological innovations. Although these projects may be manipulated by market makers in the short term, they have higher long-term value potential.
4. Monitor the addresses of large holders and liquidity changes: Through on-chain data, analyze the flow of funds of large currency holding addresses and identify whether the market makers are accumulating or selling, so as to judge the possible price trend in the future
There is indeed a chance to profit by actively deploying altcoins by taking advantage of the market sentiment brought by the rise of Bitcoin, but you must always be cautious. When trading altcoins, pay attention to their technical and financial aspects, and strictly implement the take-profit and stop-loss disciplines to make a profit in this highly volatile market.
