Source: Talk Li Talk Outside
This week, Bitcoin has continued to break historical highs, reaching a peak of around $93,000, which seems not far from the $100,000 mark that many people have been expecting. But I guess the problem many people are facing now is: is it too late to enter the market now? With the surging meme sentiment, should I also jump in? Do the altcoins I hold still have a chance?
Remember in the previous article of Talk Li Talk Outside, we also mentioned: only after Bitcoin breaks through its previous high (around $73,000 in March this year) can a new round of bull market be expected. Bitcoin is the barometer of the overall crypto market sentiment, and although not everyone holds Bitcoin, I believe many people should know that Bitcoin's continuous new highs often mean that a major bull market has officially begun.
With the official start of the bull market, the crazy surge in Bitcoin, the increasing media coverage of Bitcoin and cryptocurrencies, and the growing number of new retail investors entering this field. In recent days, I have also been closely following the ranking of Coinbase on the App Store, and found that the ranking of this app has been rising very quickly, from around 360th to the current 13th position (in the US region) in just one week, as shown in the figure below.
Here we can briefly review the historical ranking of Coinbase:
On November 25, 2020, Coinbase ranked 73rd among all APP downloads (when the BTC price was around $18,000), by April 16, 2021, this ranking had risen to 2nd (when the BTC price reached around $64,000), and then by October 28, 2021, it had risen back to 1st (after experiencing a crash in May, the BTC price had risen back to around $64,000).
On November 4, 2024, Coinbase ranked 475th among all APP downloads, and by November 15, 2024, this ranking had risen to 13th.
As for what this data is useful for, it has been introduced and shared in previous articles of Talk Li Talk Outside, and you can refer to the corresponding Bitcoin price trends for auxiliary reference.
In addition, we can also find through Google Trends that as mainstream media start to report more on Bitcoin, the current retail investor attention to this field has returned to a relatively high level compared to the first quarter of 2024, as shown in the figure below.
Through the above figure, we can also briefly review the corresponding history:
In May 2021, the Bitcoin search index soared, mainly due to the 519 incident, which caused widespread attention to cryptocurrencies.
In June 2022, the Bitcoin search index also reached a high point at the time, because the collapse of LUNA and UST triggered a series of chain reactions, including the successive bankruptcy or collapse of 3AC (the largest venture capital institution in the crypto market at the time), Celsius, FTX exchange, etc., which also attracted widespread attention at the time.
In fact, it is not difficult to see from the attention level that most ordinary retail investors tend to pay attention to (or re-focus on) the crypto field mainly through the extensive reporting of mainstream media, either when major events occur in the crypto market and attract attention, or when Bitcoin creates a new historical high and attracts attention again. Currently, the attention may be more due to the fact that Bitcoin's price is continuing to break historical records.
Of course, in addition to using the changes in Coinbase's ranking and Google Trends data mentioned above as auxiliary references for market sentiment, there are actually many other reference dimensions or indicators for the crypto market's sentiment or trends, and different people may focus on different points, as long as you find the reference indicators that suit you.
In summary, based on some current signs, it seems that the peak of Bitcoin may be approaching, so is it too late to enter the market now? Let's continue to discuss:
1. Bitcoin has not yet shown signs of a peak
I don't know how many of you remember, in the previous articles of Talk Li Talk Outside, we have shared more than a dozen long-term data indicators of Bitcoin, such as MVRV Z-Score, NUPL, The Puell Multiple, Pi Cycle Top Indicator, Rainbow Chart, 2-Year MA Multiplier, 200 Week Moving Average Heatmap, The Golden Ratio Multiplier, RHODL, AASI, AHR999 and so on.
For those of you interested in the above indicators, you can search and review the corresponding historical articles of Talk Li Talk Outside, as shown in the figure below.
In addition, we can also use data from many different angles as auxiliary judgment, such as:
- BTC ETF. Although there was over $400 million in outflows starting yesterday (November 14), compared to the inflows in previous days, this outflow is not large, so we should continue to observe and pay attention to the changes in this data. As shown in the figure below.
- BTC Funding Rate. The BTC funding rate has remained at a relatively low level since breaking $80,000, which also seems to indicate that the buying demand for BTC has not yet reached a high point in sentiment, as the end of a bull market is usually accompanied by the driving of Perps. As shown in the figure below.
Of course, data indicators sometimes also have a certain lag, and in our trading, we certainly don't have to wait for any peak signals, but should combine our own risk preferences and position management plans to execute operations. Just as I can't guarantee that I can always buy at the lowest point, that's why I adopt a DCA approach to accumulate Bitcoin. Similarly, I can't guarantee that I can sell at the highest point of the bull market, so as mentioned in the previous articles of Talk Li Talk Outside, I will set a first profit-taking target and a plan for phased selling, where the first profit-taking target is just a theoretical derivation, and the phased selling target will be determined based on the current market trend, but if the market trend still looks upward after reaching the phased selling target, I will also consider strictly executing the phased reduction of positions according to the trading discipline.
2. Altcoins have not yet performed well
Currently, ETH and some blue-chip altcoins have not reached their ATHs, even SOL, which has been very hot this cycle, is still 14% away from its ATH. As for ETH, it is even further away, still 31% away from its ATH.
At this stage, apart from BTC, everyone's attention is almost entirely focused on various memecoins, but I am still a traditionalist, and compared to the current hot memecoins, I still have more faith in the development of ETH, and I believe ETH will definitely break through its ATH, and when that day comes, it may bring about opportunities for some altcoin sectors to rotate.
From historical experience, once BTC reaches a certain level and stabilizes, some altcoins will certainly usher in new opportunities for appreciation, because the underlying investment logic remains unchanged, that is, investors will always chase after things with greater upside potential.
Here is the English translation:Based on the current situation, following the expectations (guesses) mentioned in the previous article, this bull market cycle of BTC may still have an upside potential of 30%-70%, but in terms of Altcoins, this upside potential is theoretically much larger. However, the biggest difference between this cycle and the previous historical cycles is that the number of new projects born in this cycle is severely overloaded, and the development of MEME coins also seems to have completely occupied most people's attention, which, in my opinion, is not a good thing for the healthy development of Altcoins, or even the entire cryptocurrency industry.
3. When will the Altcoin market arrive
We mentioned several factors above that affect the arrival of the Altcoin market: ETH has not yet broken through the ATH, the number of projects is severely overloaded, and MEME coins have attracted most of people's attention.
So, if we speculate theoretically, when will the Altcoin market arrive?
Currently, our expectation is that we need to wait for Bitcoin to stabilize first, whether BTC directly breaks through $100,000 or $150,000, the Altcoin market can only start to take off after BTC stabilizes. During this process, it is estimated that it will still be the stage for MEME coins, and there may also be the popularity and spread of various overnight wealth stories, attracting more and more retail investors to pay attention to and join this field.
In the previous article, we optimistically estimated that the Altcoin market in this cycle might occur in the first quarter of 2025. The consideration of this time frame is mainly based on the underlying issue of market liquidity, because since the middle of 2022, the Fed has been reducing its balance sheet, and this operation by the Fed is actually a negative factor for alternative assets (such as cryptocurrencies).
In other words, unless the Fed signals a halt to QT (Quantitative Tightening), we believe that the Altcoin market (the so-called Altseason) cannot be launched on a large scale.
The good news is that the Fed is likely to signal a halt to QT at the FOMC meeting next month (December), and this may mark the imminent start of the Altseason, which is why we were optimistic that the Altcoin season could arrive in the first quarter of next year (2025).
Of course, the above are all our subjective guesses and should not be used as any investment reference. But if our guess turns out to be correct, then now is still one of the better times for you to choose Altcoins, just focus on the leading projects in the popular tracks.
In summary, looking at the current situation, the cryptocurrency market has not yet reached the peak of this bull market cycle. This stage is more like the stage where the main force/dealers are trying to attract the retail investors to rush in, and they are also cultivating the belief (that you can make money by coming to the cryptocurrency market) in the retail investors. Through a large amount of mainstream media coverage and people around you starting to discuss it, people seem to be realizing again that they should participate in cryptocurrencies. From a more macro perspective, there are expectations of continued rate cuts by the Fed next year, and some potential measures that Trump may take on the cryptocurrency market after he officially takes office next year, so it is estimated that some traditional institutions and large funds are now also maintaining a wait-and-see attitude or are in the process of deployment.
Anyway, from sticking to DCA (Dollar Cost Averaging) in 2022 to now, we have endured too much loneliness and volatility, and now we have finally reached the expected big bull market, we just need a little more patience, and then wait for the market to fully enter the FOMO and bubble state, and then execute the exit according to the established plan.
Bull markets are often the best opportunities to make money, because during this period the market is mostly upward, but bull markets do not always keep rising, we may still face some corrections, for example, there may even be a correction of more than 30% in the future, but don't be afraid, the more this happens, the more we need to stay calm, please continue to strictly control your position, just focus on your goal, strictly follow your trading discipline. For most retail investors, the late stage of a bull market is often the most dangerous stage, and many people end up losing money in this stage, so be sure to avoid leverage trading as much as possible, don't touch it if you don't understand, wish you good luck.
