A new week has begun. Today is Monday, but the market is very sluggish. Bitcoin has fallen below 100,000 and Ethereum is approaching the 3,000 mark. Although tomorrow is New Year's Eve, think about it, when Bitcoin was at 40,000 last year, everyone was celebrating the New Year happily. This year, when Bitcoin is at 100,000, everyone is not very happy. The copycats are indeed not doing well!
The price has been hovering at a high level these days, and the turnover rate is so low that it reminds people of the eight-month garbage time. Buying is too expensive, and selling is too loss-making. The market sentiment is as cold as the weather in my hometown. In fact, it is not just the cryptocurrency circle. The U.S. stock market is also sluggish. The U.S. dollar index has been rising, causing liquidity to fluctuate and has been weak!
There are still some macro news that will affect the data this week. A-shares will be closed on Tuesday. The Federal Reserve will announce the interest rate results at 3 a.m. on Thursday. The market has a 99% probability of saying that the interest rate will remain unchanged. Although the market has already digested this result, the key is that Bao's speech will affect the market. Think about the last time before Christmas, Bao's speech directly led to the collapse of the market. I hope that this speech will increase expectations for a rate cut in March.
Regarding today's decline, the view is still the same as the false breakthrough in the past few days. Today, taking advantage of the so-called negative news of deepseek, there was a wave of false breakouts. The price fell without volume, and the copycat stocks generally could not fall.
Next, let's see whether the 100,000+ of Bitcoin can be stabilized. Deepseek is just a tool that can be used in the eyes of the dealer. The decline seems to be quite large, but there is no more chips to wash out. The same is true for Bitcoin and Ethereum SOL copycats.
The 9.8-9.6w level below the big cake is a strong support. Unless there is bad news, the price will not fall too deep.
Let’s talk about what DeepSeek is and what impact it has on the market?
CNBC in the United States did something rare yesterday. They reported extensively on a domestic AI project called DeepSeek. They also publicly questioned in the program whether an earthquake would occur in the entire AI industry as free and open source AI models like DeepSeek reduce costs to 1/30 of the original cost.
In short, DeepSeek is a brand new open source AI model, which is free, open source and low-cost. Its appearance directly makes the previously "high-end" AI technology "popularized" so that ordinary people and small companies can also afford it. For example, mainstream AI tools such as ChatGPT are very powerful, but the operating cost is also very high, requiring a lot of expensive GPU support.
DeepSeek solves two key problems:
1. Significantly reduce costs
2. Free and open source
This operation directly exposes the problem that cloud computing companies may face of user loss and declining demand. In other words, the so-called DEEPSEEK's low cost has burst the bubble of high valuation of AI, which seems to have affected Nvidia's sales, thus having a negative impact.
However, if we think about it in depth, the emergence of DEEPSEEK is good for the entire AI industry and NVIDIA. The reduction in training costs actually helps NVIDIA expand its customer base and make its market healthier. It is essentially a positive, even if it will affect sales in the short term, but in the long run it is actually a positive.
The good news is that despite the continued price fluctuations, institutional investors have not shown any panic. Instead, their purchasing power continues to rise, and U.S. investors remain optimistic about the long-term development of Bitcoin.
MicroStrategy, for example, has released a “Buy Tracker” for the 12th consecutive week, and it looks like they are preparing to start adding to their Bitcoin holdings on a large scale again.
Small investors continued to sell, and large institutions and big money players (such as ETFs and MicroStrategy) not only took over the Bitcoin sold by small investors, but also absorbed all newly mined Bitcoin. This trend shows that large institutions are very confident in the long-term value of Bitcoin. So overall, there is no bad news in the crypto market, and this pullback was brought down by the U.S. stock market.
Risks come from rising prices, and profits come from falling prices.
Now that the market has become so sluggish, it is meaningless to blame the market, complain about the market, or blame yourself for not selling out before the decline. The focus now should be on which coins are likely to rebound the most?
1: The first thing to buy is SOL. The logic has been explained many times, ETF!
2: The meme market has not ended yet, and will continue to exert its strength to create a wealth-creating effect, because most VC coins and ecological copies depend on the leader, and meme is the easiest to pull up!
3: The reason for this round of decline is also DeepSeek mentioned earlier, and it is considered to have surpassed Chatgpt. I think this is good for the AI industry. As mentioned above, there are expectations for the continued growth of the AI sector!
The current overall market situation is being severely sucked away by the chain. Ever since Trump came out, funds have been running to the chain for a long time, and it has not ended yet. Now the rise requires Trump to shout, or an independent copycat to push up the market value and drive a wave of emotions. Without these conditions, the market will be in a volatile and falling range, so everyone can spend the New Year with peace of mind.
In addition, the copycat market comes in waves, so don't panic. As long as the fundamentals of the copycat stocks in your hands are good, the increase is just a matter of time. So I tell you that if you want to sell, wait for a rebound. If the fundamentals in your hands are good, you will be confident. If you regret not clearing out before the drop, this proves that you have no confidence in the copycat stocks you bought.
The cottage industry may continue to fall for a cycle, but once the sentiment is up, it will recover in three days. The cottage industry may rebound at any time. Don’t sell at a loss and leave the market at will. Hold your positions patiently and good times will come!
