The core logic of this bull market:
First, the price of Bitcoin has risen from $25,000 in September 2023 to over $70,000, and this huge increase is mainly driven by institutional funds. However, these institutions only buy Bitcoin, and Altcoins just follow the trend of Bitcoin, with more impact on the internal speculators and retail investors. So the logic of this bull market is: the cognition of institutions and retail investors is constantly awakening, and they are interacting and countering each other.
How should we make money next?
According to the four-year cycle rule of Bitcoin, there were bull markets in 2017 and 2021, and it is expected that there will be another one in 2025. So if this year is a bull market, why can't we see any market now?
Bitcoin has already risen for more than a year, and the institutions have basically entered the market.
In this price range, institutions want to continue to enter the market, but they need to consider it carefully. New institutions may wait for the US policy to be implemented or wait for a more suitable price. In short, the rise in Bitcoin has attracted most institutional investors.
The price of Bitcoin is already very high, and the next direction needs to be chosen.
Since Bitcoin has risen to such a high position, there may be three choices next:
1. Continue to correct and form a new bottom;
2. Continue to rise and may create a new high;
3. Consolidate and grind slowly.
In my opinion, the best situation should be a slight correction and then consolidation, because so many institutions have already held it, and Bitcoin is unlikely to plummet like in 2017.
In the last round, traditional institutions like Grayscale preferred to buy mainstream Altcoins, but this round, it is the Trump family that has started to buy Altcoins.
Does this mean that institutions are starting to pay attention to Altcoins? It's not clear at the moment. It is undeniable that the entire crypto market has become very large, especially the Altcoin market is no longer concentrated on a few coins like in 2017. As a result, the market rotation speed of Altcoins has accelerated, and the wealth effect is relatively weak.
So, is there no opportunity in the crypto market?
Based on the market trends in the past few months, inflation should have declined somewhat. Theoretically, the Federal Reserve may inject liquidity again in the third quarter of 2023. If there is liquidity injection, the perspective of institutions may focus on Altcoins again, and the move of the Trump family may just be a signal. If there is indeed liquidity injection in the third quarter, the crypto market may usher in a wave of hot market in the fourth quarter.
In summary:
In any case, don't give up the crypto market. I think the best way to trade Altcoins is not to operate solely based on the logic of bull or bear market. For example, Bitcoin may have an adjustment this year, but the Altcoin market will definitely have opportunities. Remember, the market is always changing, and capital never sleeps. You need to wait patiently like a hunter for the right opportunity.
Professional creates value, and details determine success or failure.
If you feel helpless or confused in the crypto market at the moment, I hope my sharing can bring you some inspiration and help!
Finally, there are still many things that haven't been written in, such as specific opportunities and specific decisions, which are often not something that can be summarized in an article.
If you want to know more about the wealth code, or have any doubts, follow the public account: Caijing Dongchen
