Bitcoin Hits New High, Analysis of Altcoin Trends

Bitcoin recently reached a historical high of $123,000, but the altcoin market has been relatively flat. By reviewing the patterns from the last three Bitcoin breakout trends, we can make some speculations about the current market situation.

Since mid-2023, each time Bitcoin breaks through important price thresholds, it has triggered a collective rebound in alts. These breakthroughs include from $30,000 to $44,000, $45,000 to $71,000, and $71,000 to $105,000. After each breakthrough, alts typically experience a strong rally period of 3-5 weeks, after which Bitcoin enters a consolidation phase, regaining its market dominance, leading to a pullback in altcoin gains.

Currently, we seem to be in a similar market environment. Bitcoin has broken through the resistance level of $107,000 and has risen to $123,000, potentially continuing to challenge the $150,000 mark. If historical patterns repeat, this may be the starting point of a new altcoin bullish cycle.

However, it is worth noting that this may not be a prolonged altcoin bull market lasting for months, but rather a short-term sprint. Bitcoin's market dominance has not yet fallen below key levels, so it is unlikely to evolve into a full-blown altcoin frenzy. However, if Bitcoin's dominance stops rising, alts still have room to rise, similar to the last two market cycles.

Among mainstream alts, Ethereum, Solana, and XRP have shown significant divergence in their trends. Ethereum lagged behind Bitcoin at the end of 2023, but since then, the bottoms of each pullback have been gradually rising. Solana had a strong early performance, but its momentum is now nearing stagnation. XRP initially showed weakness, but experienced a significant rise after last year's U.S. elections.

Currently in the market, payment tokens have been launched first, including some "bank tokens" that comply with the ISO20022 standard. Meanwhile, some large-cap tokens that have not yet launched, such as BNB, LINK, ADA, TRX, and DOGE, are worth paying attention to. These may become the focus of the next round of capital rotation.

If Solana starts to gain funding favor, the tokens within its ecosystem are also worth paying attention to. In addition, some imitation coins of Layer 1 public chains may also welcome rotational opportunities.

For trading strategies, it is advisable to focus on blue-chip tokens, look for coins that have not yet launched, and shift towards strong narratives when leading projects launch. It may be wiser to temporarily avoid small-cap coins.

Alts may experience a strong cycle lasting 1 to 2 months, but historical experience reminds us to take profits at the right time. If Bitcoin breaks through $150,000, tokens in the top 20 by market cap may rise collectively, and some assets may see significant catch-up growth.

Maintain rational operations, hold strong tokens, and decisively abandon stagnant assets. Keep an optimistic attitude but do not fall into blind enthusiasm. Closely monitor changes in Bitcoin's market dominance and the activity of BTC trading pairs.

Although the current market may not experience the frenzy cycles seen in 2017 or 2021, it is still a relatively reliable investment window. Small market cap tokens will eventually see rotation as well, but it requires patience to wait for the right moment.