Seeing that many people are stuck in long positions on Arb, today I will talk about some market-making logic of altcoins, and finally focus on Arb:
[Phenomenon] We often see that newly listed altcoins and currencies with market-making capabilities always choose a period of time to pull up the price regardless of cost, and some can even pull up more than 10 times
【General thinking】Dog dealers pull the price to sell goods
[Essence] Raising prices is to implant a price expectation in retail investors
Detailed interpretation:
1. Altcoins that can be listed on Binance basically have an unlocking period
2. There will be artificially high prices in the initial listing stage (less circulation). According to the price of the currency at this stage, the market value is quite scary. The market simply does not have the funds to absorb all the liquid tokens, and the dealer cannot sell all the chips at once.
3. If in the initial stage, the market maker raises the price very high, for example, 10 dollars, as the popularity decreases, the price drops to 1 dollar. At this time, the retail investors who buy at the bottom have a psychological expectation of 10 times the price. They believe that this valuable coin will definitely return to 10 dollars in the next bull market.
4. However, at this stage, the unlocking of currencies has begun. Big funds can push the price to $2 and sell the unlocked currencies. This price is relatively high compared to their cost price, and the return is quite generous.
My trading strategy for altcoins has always been to buy when prices rise and not when prices fall. The reason is simple: it is easy for altcoins to rise 100%, but it is impossible for them to fall 100%. It is also relatively easy to enter the market, such as regaining a key position on the daily chart with volume.
Many people are optimistic about Arb, and so am I, but it is not a good time to enter the market. Its key support level is falling step by step, and there is no bottom in sight. If the following two points are met, I will consider spot layout:
1. BTC has pulled back to the right level and is rising in volume after consolidating at the bottom.
2. Arb's price rebounded to the key support and resistance swap level with large volume.
What ideas are needed for the current spot market?
After hitting bottom the day before yesterday, the market was quickly recovering lost ground yesterday. There was not much change in the news and capital sides. It is obvious that this wave is not the end of the bottoming out.
I have recently conducted a second systematic study on the start-up rhythm of the previous cycle, the impact of the macro cycle on currency prices, the impact of policy and funding, etc. In fact, there are many very valuable rules that can be summarized.
First: It is almost certain that the second half of this year will not fall to the bottom, but will bottom out slightly in September and then bottom out again in December-February. Therefore, there will be a small climax in October-November.
Second: The September bottoming out will not end in the middle or early part of this period, but more in the middle or late part of the month or even early October. Therefore, for us to ambush the last structural market of the year, intervening in the middle or late part of September and shipping in November is a perfect buying and selling point.
What ideas are needed for the current spot market?
After hitting bottom the day before yesterday, the market was quickly recovering lost ground yesterday. There was not much change in the news and capital sides. It is obvious that this wave is not the end of the bottoming out.
I have recently conducted a second systematic study on the start-up rhythm of the previous cycle, the impact of the macro cycle on currency prices, the impact of policy and funding, etc. In fact, there are many very valuable rules that can be summarized.
First: It is almost certain that the second half of this year will not fall to the bottom, but will bottom out slightly in September and then bottom out again in December-February. Therefore, there will be a small climax in October-November.
Second: The September bottoming out will not end in the middle or early part of this period, but more in the middle or late part of the month or even early October. Therefore, for us to ambush the last structural market of the year, intervening in the middle or late part of September and shipping in November is a perfect buying and selling point.
If there is an autumn market this year, prepare these effective investment portfolios
Screening dimension: Top 3 tokens with emerging narrative tracks
1: RWA leader: MKR AAVE COMP
Maximum Sharpe ratio portfolio allocation ratio
Annualized return: 190.00%
Annualized volatility: 0.61
MKR AAVE COMP
Distribution ratio: 96.88% 0.28% 2.84%
2: LSD faucet: LDO RPL LSD
Maximum Sharpe ratio portfolio allocation ratio
Annualized return: 536.00%
Annualized volatility: 0.56
LDO RPL LBR
Distribution ratio: 0.45% 0.54% 99.01%
3: L1 still working: SOL MATIC AVAX
Maximum Sharpe ratio portfolio allocation ratio
Annualized rate of return: -23.00%
Annualized volatility: 0.56
SOL MATIC AVAX
Distribution ratio: 97.85% 0.60% 1.55%
4: Decentralized derivatives: SNX GMX GNS
Maximum Sharpe ratio portfolio allocation ratio
Annualized rate of return: 30.00%
Annualized volatility: 0.56
SNX GMX GNS
Distribution ratio 97.85% 0.60% 1.55%
5: MEME coin leader: DOGE SHIB PEPE
Maximum Sharpe ratio portfolio allocation ratio
Annualized return: -39.00%
Annualized volatility: 0.54
DOGE SHIB PEPE
Distribution ratio 2.14% 97.82% 0.05%
6：电报Bot：UNIBOT PAAL AIMBOT
Maximum Sharpe ratio portfolio allocation ratio
Annualized return: 69.00%
Annualized volatility: 0.42
UNIBOT PAAL AIMBOT
