Always take in consideration non of this information is financial advice or official announcement from any specific project, I’m no financial advisor, trader or expert, this is just my personal opinion on certain project mention on this article, cryptocurrencies are extreme high risk assets and you must do you own research, never follow what I or other people say on internet
Market conditions to 2021 Bitcoin and Altcoins
FYI Im just a part time crypto enthusiast/invetor and dont consider myself a trader at all
Q1 of the year historically has not been that good for Bitcoin although good for altcoins, todays retracement on Bitcoin price could be an indicative that money is going to start to move from Bitcoin into altcoins, volatility is going to increase and we are going to see big moves in price, the most recent was Ethereum with a +50% move in two days.
As a consequence of Ethereum going up this much lot of ERC-20 tokens I have followed like Celsius Network going up +150% on December, Ethereum mining even with a 8 GPU Miner (Nvidia GTX 1070) generating average 0.4 Ethereum with a USD market value of $400 average as a passive income, lets say $300 after paying for electricity still more than fair. I have mention before that this time the market is different, there are several circunstances that sorround the market that are different, it's not just about crypto whales anymore with institutions going hard into Bitcoin that will soon start to invest in certain altcoins and most likely Ethereum been the second option after Bitcoin at the moment.
I'm sorry if I cant tell you where is this heading because now with such parabolic moves without any ground to sustain the price its hard to tell where is the price going, for this reason whenever I feel that Im not sure whats going to happen next is that I go into stable coins, I see ppl on Twitter saying they still buying for "long-term", that Bitcoin wont drop because of institutions, IMO this are clear signs that we have reach a temporary top on this market, I say temporary because after certain institutions have finally step into the game with large amounts of money now its the time when retail investors who FOMO and are usually called "dumb money" step in not necessarily pumping the price but becoming the bed that sustain the price while others take profits. Today is the clear example how Bitcoin drop around $5k to instantly recover.
Google trend indicates how we are still going up and most likely will keep going up for the rest of the year when there is more exposure to the news and the masses about crypto overall.
Not all altcoins will reach all time highs and with the amount of projects now days, most of the on Ethereum as ERC-20 many of the altcoins from 2017 will become legacy coins and nice altcoins will start going up in the ranks
- Polkadot
- Chainlink
- Celsius Network
- Uniswal UNI
- AAVE
Just to mention a few that will keep going up while others go down, some of the reasons for this to happen is because despite how savage are Gas fees on Ethereum, many developers have come to the conclusion that probably the best network to be in is Ethereum for many reasons but for the most part is because of the large community and adoption. For the mast four months besides other regular passive income I get from crypto investments/activities I have been focus to invest on Ethereum and ERC-20 Tokens, not necessarily DeFi projects because of all the hacks and exploits but on some tokens that are niche on their own class of business and benefit from the price increase on BTC and ETH, not trying to complicate too much things looking into the next "Ethereum Killer" as this phrase was trending on 2017.
Besides the type of investors in crypto, the porpouse of crypto projects have change, is not anymore of what is the best cryptocurrency dedicated just for transactions, now days is about interoperability, been able to communicate between multiple chains and in this case been Ethereum most of the time the HUB, the amount of use case now days for Ethereum and the simple solution of smart contracts has evolve to actually become a necessity for any crypto project now days, if the project you choose cant communicate with other chains or doesn't support smart contracts its just another coin trying to be just a medium to transact and becoming one of the rest.
Crypto market will correct a couple of times same as it did on 2017 before it keeps going up, at the moment the main crypto currency that is Bitcoin looks a little overextended after braking $20k without any sideways price action to create the foundation of new support area it has been a very aggressive upward trend without stop and it's probably time for it to take some rest, todays drop of about -17% on the daily chart is a common correction in crypto but it doesn't mean that is over.
If we zoom out, really zoom out, you can see on the monthly chart how Bitcoin has been bullish since 2017, with 2020 been the most aggressive move, now there is a massive gap in price from its previous all time high, from $20k to $29k just in one month December 2020 without any significant support created, last bull market we saw Bitcoin going down -80% in price taking it from $20k all the way down to $3k, if we get anything from -30% to -40% meaning half of that price action Bitcoin would sit very close to $20k a very psychological target based on the events of 2017 and since crypto is a total different monster than other markets braking $20k you will see ppl on twitter saying tha its game over , you can visit https://99bitcoins.com/bitcoin-obituaries/ and check the list of articles where many ppl have said BITCOIN IS DEAD just because they don't understand the product of this technology neither understand that there are many factors make this the biggest speculation show on earth since there is no BITCOIN CEO/OWNER, this bull market could be different in a way that it takes a rest and doesn't completely NUKE the price just because ""Institutions"" bought Bitcoin heavily but consider that crypto whales at this point in the game have also a lot of power within this small market and can dump the price so fast to make Institutions puke and continue dumping the price and that's when the new accumulation of Bitcoin starts, right now the chart is so parabolic for me its hard to say where is this exactly going although I can tell based on previous price action potentially how far this it can go down.
Bull case: Bitcoin drops 40% to the $20k area start building support over previous all time high for a continuation during 2021
Bear case: Bitcion starts dropping at the end of next month for a similar behaviour of 2017 blow off top with a possible bottom between the $11k to $9k range
Right now IMO is not the time to buy crypto, it's not the time to invest with your FIAT, this is probably the time to keep generating with what you already have, say trading if you trade, mining, staking, any other way that generates more crypto for you although is not the time to start buying at least I'm not doing it since December 23 that's when I stop even trading.
I hope this article explains my perspective of the current market, Im not bearish since there could another leg up after a correction on 2021 but I'm also not bullish to say Bitcoin and the rest of the market will keep going up to $100k.
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