Macroeconomic situation and CPI today:
CPI for November 2024: Released at 2.7%, higher than the forecast of 2.6% and the previous month's 2.6%.
Significance:
Higher-than-expected CPI shows that inflation is still not fully under control.
Increased likelihood that the Fed will continue to maintain a tight monetary policy, or even raise interest rates, putting pressure on risk assets like cryptocurrencies.
1. BTC Dominance:
Currently: BTC Dominance is around 57%, higher than the average level of 2024 (~53-54%).
Significance:
The market is pouring capital into Bitcoin, reflecting investors' defensive sentiment.
This often occurs when the market is under pressure from macroeconomic news or concerns about significant risks.
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Impact on the cryptocurrency market:
1. Bitcoin (BTC):
With capital flow focused on Bitcoin, BTC may maintain support levels or even increase slightly if capital from altcoins continues to flow in.
Resistance: $100,000.
Support: $97,000.
1. Altcoin (ETH, SOL, DOGE):
ETH (Ethereum): May hold around the current price but finds it difficult to break resistance in the short term.
SOL (Solana): Under pressure from declining prices due to increased BTC Dominance, may test lower support levels.
DOGE: More sensitive to market sentiment, higher likelihood of decline in the context of capital flow concentrating on BTC.
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Trading recommendation:
1. For BTC:
Short term: Can hold or buy at support areas ($97,000-$98,000), targeting resistance at $100,000.
Long term: Continue to accumulate BTC if there is a correction, as capital flow still prioritizes Bitcoin in the context of inflation and economic instability.
Portfolio overview:
Increase BTC holdings ratio (~60% of the portfolio).
Reduce altcoin ratio, prioritize holding stablecoins (USDT, USDC) to wait for opportunities.
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Conclusion:
Higher-than-expected CPI and strong increase in BTC Dominance reflect the market's defensive sentiment. In the short term, Bitcoin remains the most attractive asset, while Altcoins will face pressure. Investors should focus on Bitcoin and limit altcoin trading during this period to optimize profits and reduce risks.
#BTC #ETH
