BTC Breaks $34K
It is almost unbelievable to think that Bitcoin has rallied from $14K to $34K without experiencing any significant retracements along the way. Dumps of a thousand dollars or more are instantly bought up, as investors waiting for a perfect entry point are being driven higher and higher as they wait in anticipation of better prices. The largest dump, in percentage terms was approximately 15% earlier on in the rally.
On the bearish side, the $34K to $40K level may prove to be far too tempting for traders to ignore. However, the buy pressure has been extremely strong up until this point. Profit taking by traders may once again prove not to be as devastating as many may think.
Some altcoins such as Litecoin, Polkadot and Doge are currently performing very well, though most altcoins are really struggling against an immensely powerful BTC price. This brings me to how I am going to be allocating altcoin profits in 2021, considering prices are extremely weak against BTC! There is a portion of my altcoin income that is instantly converted into fiat for living expenses. The rest is to hodl and use in my Passive Crypto Income Systems.
The Purpose Of Utilizing Altcoins
Many people accumulate altcoins as a speculative move, in the hopes that they will be able to multiply their initial investment many times over. I also look for projects that have tremendous upside potential. However, my main ambition is to accumulate alts that have earning capabilities. Whether this be in the form of staking, lending, smart contracts or liquidity mining. As long as I can earn income from a coin or token without needing to rely on price action and appreciation, then that is 1st prize for me.
Of course the coin needs to be relatively stable, so as not to dilute away my earnings through massive depreciation. The most volatile token I am currently utilizing is BNKR, so the risk is moderate, as the majority of my altcoin holdings are in TRX.
Due to the current altcoin market, I have decided not to sell altcoin income for BTC at this point. I will rather let those earnings sit until alt season, at which point prices should rise significantly against BTC. Even if the alt season is not as impressive as expected, I will at least make 2X to 3X the satoshi value I would make currently.
In a recent post, I made mention of the possibility that this could be the final significant alt season. That in cycles to come, alts will be very selective and the ones that prosper will have already accomplished the enormous gains needed to cement them in the "select" bracket.
I expect this market to tighten quite severely in the years to come. Suffocating the weak, underdeveloped projects that managed to survive in previous years. This is also a contributing factor in regards to my flight to BTC and ETH, as a shift to quality is inevitable at some point! Better too early than too late!
These are my interpretations of the market and should not be considered investment advice in any way.