After Bitcoin and Ethereum hit a spike yesterday, it directly came back for a second test. Bitcoin's lowest retracement was around 94,200, and Ethereum around 3,510. According to what was discussed yesterday, Ethereum around 3,500 is already a good area for low buying. For those who previously profited at lower levels or haven't entered yet and want to lay out again for ETH's upgrade speculation next year, around 3,500 is completely a good entry point. In a bull market, sharp drops are followed by slow rises. Each sharp drop is a good opportunity to re-establish a position. The key is human nature's panic or greed, always wanting to buy at lower prices. However, bottom-fishing is something that the main players do. We just need to enter according to our established plan.
Participation in this market must be planned, and execution must be rational according to your plan rather than hoping to place a big bet to get rich quickly. Such operations often backfire. Although sometimes luck brings significant returns, such behavior fosters a gambling mentality that ultimately returns to the market! When the market is unstable, it is advisable not to touch highly volatile altcoins or high-leverage contracts. If you participate, stick to ETH, SOL, BNB, etc. When the market resumes, we can ride the wave of altcoins' recovery. At this stage, prioritize defense, survive first, and protect your principal; the next waves of market movements will relate to you!
Navigating a bull market requires a planned trading strategy. I've been emphasizing position control, including reducing positions to achieve zero cost, which is not just talk. After formulating a trading strategy, what you need to do next is to execute it strictly. Your returns in this bull market won't be poor.
1: In a bull market, the best strategy is to achieve zero cost. What does zero cost mean? For example, if you entered around comp71, with a peak of 144, and when it was at 140, you reduced your position entirely, leaving all remaining as profit; this is called zero cost.
During these two days of adjustment, you are completely unhurried, and it won't hurt you, nor will it cause anxiety or impatience that leads to mistakes. In simple terms, if it rises, you still have profits on the table, everyone is happy; if it falls, there's no anxiety, and your principal isn't hurt. This is the advantage of zero cost.
2: Don't sell all quality altcoins; rare opportunities to get back in at low prices will not come again except for black swan events.
For instance, our earlier FET at 1.3, DASH at 35, PEPE at 115, and LPT at $11. Without significant bad news, it would be very hard to see such low prices again. If you sold everything last week, that's a pity. As long as your targets are decent, taking off in the current bull market is just a matter of time. Selling out prematurely is the most painful situation in a bull market. To prevent selling out, you should keep some core positions and strive to hold at zero cost. Learn to sell in batches and learn to hold positions. While it sounds simple, I've strictly adhered to this trading system for three years. The execution is what is difficult.
No one has unlimited bullets. Doubling positions and continuing to bet on the next hot trend, reasonable planning is the key to going further.
3: When clearing out positions, always clear half first before finishing the rest, rather than selling everything at once. No one can pinpoint the exact top or bottom of the market. Refer to the previous two points; when to sell, I believe you already have the answer in your heart!
In the crypto sphere, being able to sell is how you enjoy the dividends. Timing your exit is crucial in a bull market. Once a trend is established, no matter where you buy in, rising is just a matter of time. There are many signals for the top, such as frequently trending on hot searches, or the altcoin speculation index reaching its previous high or historical high. If you reference these data points when selling, you may not hit the peak, but looking back, it is likely to be a significant high point.
The challenge is execution. You must take action to navigate the entire bull market!
Macroeconomic Data
This week is crucial on the macroeconomic level, with several key inflation data about to be released, which will affect expectations for the next rate cut.
Data to be released at 9:30 on Wednesday includes: CPI
PPI will be released at 9:30 on Thursday.
Tonight's CPI data release is undoubtedly the market's focus, and many friends have already begun to speculate on how Bitcoin will react. Personally, I remain optimistic. The logic is still the same as last Friday's non-farm payrolls; the current expectation is for inflation to rise. Even if inflation data slightly increases, it won't affect the Fed's established path of rate cuts in December. A continuous 72-hour decline is also rare historically, so the possibility of a short-term rebound remains high. Just as a bowstring pulled tight will inevitably accompany strong rebound force.
This month has both favorable and unfavorable factors. Tonight's CPI, whether MSTR will be included in QQQ, FASB coming into effect, the Federal Reserve's monetary policy meeting, Japan's monetary policy meeting, as well as Christmas, etc. In January 2025, Trump will take office. News from yesterday suggested that Trump hopes to push BTC to $150,000 in the early days of his presidency. So, can ETH ride along with altcoins for a wave?
And the expectations for policy easing are favorable, while on the downside, pay attention to interest rate cuts and economic conditions. However, the next monetary policy meeting is on January 29, and the official appointment is on January 20.
After a significant drop of 12.9, it has gradually recovered some. The previously surging SOL, DOGE, PEPE are all opportunities for orders. Market speculation is ever-changing; we need to have a keen sense for the market and keep up with the changes!
