When you no longer believe that this is a bull market, the bull market will not disappear

Compiled by: Deep Tide TechFlow

Cryptocurrency – Is the top already here?

This is a taboo question in the cryptocurrency community (CT).

However, ignoring it can be costly (which is why most people go through full up and down cycles).

"The reality is, it doesn't go away when you stop believing in it." - P. Dick

Here's why a top may have occurred and how to still thrive despite the situation.

Disruption of Market Structure

The first major concern is that $BTC recently lost a 4 month range.

While the long-term trend remains intact, the medium-term trend has turned bearish.

Andrew Kang sees this as similar to May 2021 price action.

Potential double top?

With the loss of key support levels, the double top pattern on the weekly chart is difficult to ignore.

While I’m not a technical analysis expert, this looks like a classic Complacency Shoulder pattern.

"Spot markets are comfortable, cryptocurrencies are safe as liquidity will rise again" = Consensus View

From "Wall of Worry" to "River of Hope"

The bull market is climbing the "Wall of Worry" "; the bear market has slipped down the "river of hope."

This transformation happens gradually and the top is usually confirmed only after the fact.

To assess this shift, the following points can be analyzed:

• Price reaction to positive/negative news
• The psychology of idle capital

Market reaction to news

In a weak market, good news is It falls on deaf ears, and bad news causes great fear.

Recent examples:

• Good news: Trump talks Bitcoin ($BTC) as a corporate asset + Ethereum ($ETH) ETF launching soon.
• Bad News: Mt. Gox/Germany Sells Bitcoin ($BTC)

Idle Capital and Dip Hunting

Retail investors blindly dipping into the bottom without a clear catalyst is a concern.

Markets slide down this river of hope as complacency and denial turn to panic.

Technical Rally in 2022

The market experienced several technical rallies in 2022, but no trend reversal.

Ideally, you want to see significant catalysts ahead, with idle capital hesitant to buy the dip.

The opposite signals danger, as the recent price action of the Ethereum ($ETH) ETF has shown.

Bitcoin Super Cycle Theory

Many altcoins may have peaked, but Bitcoin ($BTC) may be entering a super cycle.

While global liquidity may be surging, this challenges the assumption that altcoins are the fastest horses.

A paradigm shift may be underway, its effects lagging.

Bitcoin vs S&P 500 Divergence

Bitcoin’s ($BTC) weakening correlation with equities (lowest in 4.5 years) could be a concern.

Significant oversupply (Germany/US etc.) could push this decoupling to the limit.

Similar to 2019

Bitcoin ($BTC)’s divergence from the S&P 500 ($SPX) is similar to 2019, when Bitcoin peaked in June.

It took over 12 months to reach new highs.

Large AI companies overshadow cryptocurrencies

Maybe the market peaked not because cryptocurrencies are bad, but because AI is more attractive.

We are seeing the thinnest stock rally in history (led by large AI companies).

While access to Bitcoin ($BTC) has never been better, retail demand is growing slowly. Why?

Is the biggest craze over?

The biggest craze may be over. This cycle may be short-lived.

Evidence: memecoin peaked in the first quarter of 2024 and has been trending downward since then.

Bitcoin ($BTC) peaked in Q1 2024 (coincidence?)

Memecoin Super Cycle = Top Signal

The concept of “memecoin super cycle” could be the ultimate top signal.

A similar top signal occurred in 2021 when some predicted that Bitcoin ($BTC) would enter a super cycle ($250k+ $BTC).

With less disillusionment this cycle, maybe we get into memecoin mania faster.

Domination of Memecoin Space

For the first time, memecoin has become the most popular category on CoinMarketCap (CMC).

How long can altcoins run in a speculative bubble without practical applications driving organic demand?

Profit from Hedging

Even though we may have reached the top, it doesn’t mean all hope is lost.

Hedging a strong altcoin by shorting a weak altcoin can be very profitable.

This allows you to profit from declines while still maintaining market participation.

Bitcoin Dominance Rising

In risk-averse markets, investors selling altcoins for Bitcoin ($BTC) tend to increase Bitcoin dominance.

Shorting the weak ALT/BTC trading pair to capture this trend can be very profitable.

@intocryptoverse believes Bitcoin dominance ($BTC.D) could reach 60% by Q4 2024.

Profiting from VC Greed

Identify coins with oversupply and huge VC unrealized profits.

What if the four-year cycle is broken?

Imagine if March 2024 was just the peak for the next 6-12 months?

Is this still the top of the cycle?

Given the limited upside so far this cycle, it is reasonable to expect fewer downsides as well.

Because of short cycle + low volatility.

Macro top not appearing yet?

Although there are some potential signals, the top of the cycle may not have been reached yet (personal opinion, for reference only).

Liquidity is the most critical factor and there is strong evidence that the peak may occur in 2025.

While liquidity is currently low, we appear to be on the verge of a major shift

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