Funds are still flowing into the market. Where will the next market outbreak point be?

Followin' the crypto market this week has shown a downward trend due to the Christmas holiday, with the market sentiment index rising slightly from 7% to 10% but still in the extreme panic zone. However, USDC, which is mainly based on the US market, still achieved a 1.91% growth, indicating that institutional capital is still entering the market and injecting some confidence. The market is expected to continue the sluggish trend during the New Year's holiday. It is suggested to maintain a defensive configuration, increase the allocation of top assets, and moderately participate in high-yield DeFi projects. In the long run, the market generally expects that the upward trend may come in the first quarter of 2025, and AI Agent and DeFi projects are worth focusing on. Altcoins have underperformed the benchmark index this week, showing a significant downward trend. Due to the Christmas holiday, liquidity has dropped sharply, leading to increased volatility in market prices and causing rapid rises and falls. As a result, market sentiment is not high. Given the current market structure, it is expected that Altcoins will remain in sync with the benchmark index in the short term, with a low probability of independent trends. When Altcoins are in the extreme panic zone, the market is often at a stage-wise bottom and may turn upward at any time. The potential outbreak points in the market are: 1. AI Agent: The discussion around the AI Agent+TEE model and its impact on DeFi has been the most active in the market this week. If the aipool model is widely accepted by the market, it may lead to a new wave of asset issuance in the near future. 2. DeFi: The core driving factor for the recent uptrend is the increase in yields of stablecoin yield projects, which have become more attractive compared to other projects due to the decline in basic lending rates. The continued inflow of capital into USDC also indicates that the market's buying power is still maintaining a sustained entry. Potential risks include the lack of liquidity during the holiday period, leading to increased volatility and the risk of liquidation of long positions, which can further exacerbate the downward trend. It is suggested to maintain a defensive configuration, increase the allocation of top assets BTC, ETH, and moderately participate in high-yield DeFi projects to hedge risks.