This is an opportunity for us! Here are some tips we have listed from Western analysts who analyze the psychology of retail investors during the altcoin season and how to seize opportunities in the altcoin season before the crowd pays attention đ
Fact: If you don't take advantage of it, you will forever be providing liquidity for others to take profits!
Some tips you should grasp (1)
The following image shows the importance of helping you understand market cycles, which are the stages of ups and downs that the market has gone through over time.
Stage 1: Bitcoin
Money will show signs of flowing into Bitcoin, causing a significant increase.
Stage 2: Ethereum
Then it will flow into Ethereum, but the drawback is that Ethereum will struggle to keep up with Bitcoin in this stage.
Next, there will be signs of Ethereum oscillating with Bitcoin and starting to outperform.
Stage 3: Large Caps
Money will start to flow into large-cap tokens, followed by signs of an increase.
Stage 4: Altseason
In a state where large-cap tokens experience a significant increase, it will lead to a simultaneous increase in mid-cap and small-cap tokens, along with the emergence of meme images everywhere.
Intermittent Stages
Of course, in these four processes, there will be occasional overlaps in each stage. For example, Bitcoin may experience sudden increases or decreases against Ethereum. Even Altcoins can increase without relying on market cap.
Hint: User psychology often measures and chooses suitable market cap tokens (mostly smaller caps, but there are also bigger ones, though rare).
On-chain metrics measure market sentiment (2)
Is this an advantage that can help you? Why should you look into it? All of these will be answered belowđđ»
Elon Musk's social presence
Looking at this chart, it is evident that the ratio of BTC and ETH always leads in terms of community tweet trends. However, the ratio of ETH is still lower than BTC during this period (possibly due to trends like BRC-20, Bitcoin ETF, etc.).
It can be seen that from 2021 until now, there are still no signs of a resurgence, which means that there is nothing as vibrant as in 2021. Therefore, there are still no signs of creating additional liquidity for the market.
Why observe YouTube?
We can refer to what viewers are interested in from investment channels on YouTube such as Bitboy Crypto, Datadash, The Moon, etc. (Retail investors always utilize YouTube as the second tool to update information from professional investment channels).
This means that DApps always leverage YouTube as a place to provide additional market information, which also means that more people watch and create additional liquidity for the market.
Fact: More viewership equates to the creation of more liquidity for the market.
Reddit's market excitement is in the past
At its peak in 2021, Reddit used to receive 1 million comments per day. But now, it is only a thing of the past, as the index shows an 85% decrease.
It can be seen that market excitement is still lacking, and everything is not functioning as in the 2021 period.
In the end, Layer 2 is just a trend
The growth of Layer 2 has significantly slowed down, unlike the super-hot period when everyone mentioned it. Although recent projects related to Layer 2 have gained popularity and experienced sudden price increases, there are still not many new participants, and the majority are existing participants.
However, don't be sad because this is a common situation in the market, not just for Layer 2. Eventually, everything will return to its trajectory, and it may become even more vibrant than the previous period.
Summary
After all, those who remain in the bear market are still Crypto Natives. The recent vibrant activities are mostly driven by these Crypto Natives, and perhaps we are still in the early stage of the altcoin season.
This article mainly provides a comprehensive perspective on the market. So it doesn't mean that the prices of altcoins cannot increase in the future.
The purpose of this article is to refer to how Western analysts analyze the psychology of investors in the current market. Shortly, we will have more articles dedicated to newcomers to refer to!
