Altcoin investors may experience a prolonged decline in value until late January 2025

As we approach the end of January 2025, Felix Hartmann, founder of venture capital firm Hartmann Capital, believes that the majority of altcoins may continue to see a downtrend. In a recent Xpost on December 10th, Hartmann stated that some alts may experience brief periods of growth but are likely to slow bleed or consolidate for 2-6 weeks.

The Challenges Ahead

Hartmann emphasized that there isn’t much "alpha" (excess return) in chasing altcoins at this point. Many have already seen significant price increases, with some experiencing a 2-3x move in just one week. With the current market conditions, it may be more beneficial to adopt a long-bias strategy.

The Impact of Short Squeezes

Hartmann believes that Bitcoin has a "fair chance" of retesting $99,000, primarily driven by short squeezes. This phenomenon occurs when investors who are short-selling Bitcoin (i.e., betting against its price increase) suddenly buy back their shares to cut losses, driving the price up even further.

Liquidity and Short Positions

As of now, there’s a significant amount of liquidity building up on the topside for Bitcoin. This means that if the price were to surpass $99,000, around $1.53 billion in short positions would be at risk of liquidation. The current market conditions suggest that investors are closely watching Bitcoin’s next move.

Expert Insights

Daan de Rover, co-founder of CryptoSea, emphasized that there’s a lot of uncertainty in the market. He stated: "We all know what’s next." This sentiment is echoed by Felix Hartmann, who believes that each rally and dump brings us closer to return dispersion in the space.

What’s Next for Bitcoin?

Daan Crypto Trades, a pseudonymous crypto trader, recently shared his insights on the current market conditions. He stated: "Bitcoin generally moves 30-50% after breaking a long consolidation within this cycle." If history repeats itself, the next consolidation period should be shorter, followed by a new leg higher in Q1.

Market Sentiment and Trading Mentality

Syncracy Capital co-founder Daniel Cheung recently highlighted that traders have shifted to a "short-term" trading mentality during this cycle. Crypto analysis firm Santiment warned that if retail traders react with fear and offload their crypto too quickly, it could trigger an aggressive recovery.

Conclusion

The altcoin market continues to decline, with many experiencing significant losses over the past 24 hours. The current market conditions suggest that investors are closely watching Bitcoin’s next move, with some experts predicting a potential retest of $99,000. As always, every investment and trading decision involves risk, and readers should conduct their own research before making a decision.

Related Articles

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This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Important Links

• Hartmann Capital: https://www.hartmanncapital.com
• CoinGlass: https://coinglass.com
• CoinMarketCap: https://coinmarketcap.com

Note to readers:

Please keep in mind that this article is for informational purposes only and should not be considered as investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research before making a decision.