Amid ongoing volatility, the strategy of buying on dips will remain relevant “far longer than everyone expects,” according to Daniel Cheung, co-founder of Syncracy Capital.
Market participant psychology has drastically shifted in crypto this cycle.
In prior cycles, participants largely engaged in a HODL and buy the dip mentality.
This cycle, participants are mostly in a short term / trading mentality and constantly looking to take profits, despite…
— Daniel Cheung (@HighCoinviction) December 9, 2024
According to the expert, market participant psychology has fundamentally changed this cycle. Previously, they adhered to HODLing and accumulated during downturns, whereas now they aim to lock in profits. Although, in the long term, perfect timing is rare.
As a result, the upward trend will have a more prolonged nature, he noted. Cheung added that a return to focusing on holding longs will lead to the formation of a “true peak.”
Bitfinex suggested that Bitcoin’s decline may not be as deep as on December 6, as selling pressure has significantly weakened after the first price jump above the six-figure mark.
Experts cited a decrease in daily realized profits. The figure spiked to $10.5 billion but then fell to $2.5 billion. Supporting this scenario is the normalization of funding rates in the crypto derivatives market — a sign of reduced leverage.
Inflows into ETFs have slowed slightly, but they remain a key source of support amid profit-taking by HODLers, experts emphasized.
QCP Capital indicated that a catalyst is now needed to break through $100,000. According to analysts’ observations, interest in near-term options remains more focused on puts.
4/ #BTC & #ETH vols high, skewed to puts.
Macro volatility has eased with political stability in France and Korea, and Asia rallying on China’s stimulus.
A major catalyst is needed to push #BTC to 100K. Are we close?Read the full analysis here: https://t.co/TrAvPFltNd
— QCP (@QCPgroup) December 10, 2024
Santiment forecasted a swift recovery for TRX, AVAX, DOT, ICP, POL, FIL, and TIA. Specialists noted that following a sharp sell-off on “fears,” there will be an equally aggressive rebound in prices.
? Altcoins, particularly those that have surged significantly during this 2-month bull rally, have plummeted today. If retail traders react with fear and begin selling off their bags, expect a swift rebound to assets like TRX, AVAX, DOT, ICP, POL, FIL, and TIA. pic.twitter.com/tW8AzzGLjc
— Santiment (@santimentfeed) December 9, 2024
CryptoQuant previously warned of a potential pause in Bitcoin’s rally.
Earlier, Jamie Coates, chief analyst at Real Vision, suggested that the digital gold price might enter a correction in two to three months.