Recently, with Trump's change of attitude towards cryptocurrency after taking office, he declared that he would support the development of cryptocurrency, which added fuel to the cryptocurrency market. The price has soared, and many people are eager to try it out.
Cryptocurrency is a digital or virtual currency that uses encryption technology to ensure security. It is different from the legal tender such as paper money and coins that we usually use. It is not issued by a certain country or region, but is based on blockchain technology. It can be said to be "rootless water".
Trend of mainstream currencies
Recently, the cryptocurrency market has been surging, and Bitcoin has been sucking blood and soaring, constantly breaking new highs. For example, after setting a record high of $106,660 on December 16, it exerted its strength again in the early morning of the 17th, reaching a high of $107,796. At the time of writing, there was a slight correction, but it remained at a high level. Ethereum also followed the pace of Bitcoin, and the price rose all the way. For example, during December, Ethereum once rose to $4,081, which was the highest price recorded since December 2021. Its performance was very impressive.
As the two mainstreams of the cryptocurrency market, the rise of Bitcoin and Ethereum has played a strong role in driving the entire market. The continuous rise in Bitcoin prices has attracted the attention of many investors, and funds have flowed in, which has also continued to increase the activity and attention of the market. Ethereum has also shown strong resilience and potential in this round of market conditions. As its price rises, it has further consolidated its important position in the market, making the entire cryptocurrency market present a bull market, and many investors are full of expectations for the subsequent market conditions.
Performance of altcoins
At a time when mainstream currencies are strong, the performance of altcoins is somewhat differentiated. Some altcoins have not seen a significant rise in the context of a positive market, and even have fallen but not risen. For example, many altcoins have remained in place or fluctuated slightly when Bitcoin and other currencies rose. For example, some altcoins with less popularity and limited application scenarios can only "wait and see" on the sidelines due to the lack of sufficient capital inflows and market attention.
However, some altcoins have performed well under the influence of market sentiment. When Bitcoin sucks blood and soars, attracting a large amount of funds into the market, occasionally some funds will overflow into the field of altcoins, giving some altcoins a short-term opportunity to rise. But in general, the rise and fall of altcoins are greatly affected by the overall market trend and capital flow, and the fluctuations are often more intense. Investors need to be more cautious in analyzing and grasping the timing when participating in altcoin transactions.
NFT Project Dynamics
When the overall cryptocurrency market is improving, NFT projects have also seen signs of recovery, among which the performance of Pudgy Penguin NFT is particularly outstanding. After Bitcoin broke through $100,000, the crypto market quickly bet on the arrival of the Altcoin Season, and funds began to return to the NFT market. The floor price of the Fat Penguin NFT soared by more than 55% in a single week. According to Coingecko data, its current floor price has exceeded 32 Ethereum coins, reaching about $122,000, setting a new record again.
There are many reasons behind the outstanding performance of the Fat Penguin NFT. Since its launch in 2021, Fat Penguin has accumulated a certain amount of popularity in the crypto community with its image of "cute penguin". Its IP is not only popular in the virtual market, but also quickly captured the offline market and expanded its influence through cooperation with global retail giants such as Amazon and Walmart. In addition, the project announced on December 6 that it would launch the official token PENGU on the US blue-chip public chain Solana. As soon as the news came out, the floor price soared rapidly on the same day, which attracted great attention from the market. However, investors also need to note that the NFT market itself has a certain volatility. As past experience shows, the price of NFTs after the airdrop may fall in the short term, so when participating, you should still be rational, fully assess the risks, and avoid excessive speculation.
Analysis of key influencing factors
Influence at the policy level In the cryptocurrency market, factors at the policy level often play a vital role, and the relevant developments in the United States are even more concerned. Trump has a positive attitude towards cryptocurrencies. He promised to make the United States the global capital of cryptocurrency and support the establishment of a strategic Bitcoin reserve. For example, after his election, he nominated Paul Atkins as the chairman of the U.S. Securities and Exchange Commission (SEC). Atkins has always been a supporter of the cryptocurrency field. If he takes office, he may terminate the SEC's pending cases against cryptocurrency trading platforms such as Coinbase and implement more relaxed policies, which has a direct stimulating effect on the prices of cryptocurrencies such as Bitcoin, and Bitcoin has risen above the $100,000 mark.
In addition, the results of the U.S. election will also affect the direction of the cryptocurrency market. Differences in the governing philosophies of different parties will bring about changes in regulatory policies, which in turn affect investor confidence and capital flows. When it is expected that policies will tend to be loose, the market will often usher in more funds, and investors will be more optimistic about the market outlook; on the contrary, if the policy tends to tighten, investors may become cautious and even sell, leading to increased market volatility.
In addition, the progress of relevant bills in the United States is also critical. For example, the 21st Century Financial Innovation and Technology Act aims to delegate more cryptocurrency regulatory power to the Commodity Futures Trading Commission, which is tolerant of digital assets. Although the plan was previously shelved by the Senate, once there is new progress, it may change the pattern of the cryptocurrency market. Investors need to pay close attention to these policy-level changes in order to adjust their investment strategies in a timely manner.
Market sentiment analysis
In the current cryptocurrency market, investor sentiment is in a complex state. On the one hand, as Bitcoin continues to soar and set new historical highs, mainstream currencies such as Ethereum have also steadily risen. The entire market is filled with greed and FOMO (Fear of Missing Out). Driven by this emotion, a large number of investors have flocked to the market, as if they have seen an opportunity to obtain huge profits and do not want to miss this round of possible bull markets.
However, the market dominated by this emotion also hides many risks. Excessive greed and blindly following the trend can easily make investors ignore the risks of the market itself and make irrational investment decisions. For example, investors may blindly chase the rise at a high level without considering whether the asset price is already overvalued. Once the market pulls back, it is easy to suffer a large loss. Moreover, market sentiment is highly contagious. When most people are in a frenzy, it often indicates that the market may be overheated and the adjustment period may not be far away. On the contrary, if market sentiment suddenly turns to panic, it may trigger a large-scale sell-off, causing the price of the currency to fall rapidly, forming a vicious circle. Therefore, investors need to keep a clear mind at all times, look at market sentiment rationally, and avoid being swayed by it and falling into a passive investment situation.
Interpretation of technical indicators
From a professional technical perspective, indicators such as the K-line trend of cryptocurrencies such as Bitcoin and Ethereum can provide investors with important operational references. Taking Bitcoin as an example, it presents different rise and fall characteristics and trends in different time periods. In the 4-hour period, the K-line fell with shrinking volume (until a specific time point), but at 2 a.m., it rose again and hit a new record high of around 107,793 U.S. dollars. It is currently in the high-level wash-out oscillation in the wedge-shaped rising channel space, and a top divergence pattern has appeared. The price has a need for a correction, and the upper neckline pressure level near 107,280 needs to be paid special attention.
From the perspective of the Gubi trend indicator, Bitcoin has a resonant bullish trend in all cycles of large, medium and small, which can be used as a basis for buying on dips in short-term operations. However, its daily MACD indicator has a top divergence pattern, and the 1-hour MACD indicator has a rootless water pattern, which means that although the overall price trend is upward, there is a possibility of a correction in the short term, so investors can choose to enter the market with a light position when the price is pulled back to the small cycle 30 minutes, 1 hour EMA60 moving average or the important neckline support level, but be sure to bring a stop loss and do a good job of risk control.
For Ethereum, it can also be analyzed through indicators of different time periods. For example, in the 4-hour K-line trend, the pressure level is around 4059-4121, and the support level is around 3886-3971. Investors can refer to these pressure and support levels to decide the timing of buying and selling. When the price is close to the support level and there are signs of stabilization, they can consider appropriate intervention; if it is close to the pressure level and there is a lack of upward momentum, they can consider partial profit taking or reducing positions to cope with market fluctuations and seize investment opportunities.
Summary
On the whole, the cryptocurrency market is expected to continue to show a fluctuating upward trend in the future, but the process will inevitably be accompanied by many risks and uncertainties. Investors need to pay close attention to market dynamics, keep up with key factors such as technological development, policy changes, and macroeconomic conditions, adjust investment strategies in a timely manner according to their own risk tolerance and investment goals, and participate cautiously.
