Hot topic interpretation:Statistics show that the most popular cryptocurrency narrative of 2024 so far is “Memecoin,” attracting nearly 31% of investors. Occupying nearly 15% of market traffic, followed by AI and RWA narratives, accounting for 12.58% and 8.64% of market traffic, respectively.We believe that the popularity of the “Memecoin” narrative in the cryptocurrency field in 2024 reflects the market’s preference for fun and community driven assets. Memecoin has attracted nearly 31% of investors and accounts for nearly 15% of market traffic. In addition to traditional investment logic, the market has shown a strong interest in assets with cultural resonance and social media influence. AI and RWA narratives respectively occupy the second and third market traffic, indicating investors’ attention to emerging technologies and actual asset tokenization. The rise of Memecoin is not just a financial phenomenon, it also integrates humor, community engagement, and cultural movements, becoming an undeniable force in the cryptocurrency field. This trend may continue to affect the development of the cryptocurrency market, especially in attracting new investors and innovative projects. In the coming year, we can also pay more attention to the performance of these three major conceptual sectors.
Cryptocurrency market analysis:
BTC market analysis:On December 18th, BTC fell from its peak of 108350+US dollars in this round, and the market showed a clear downward trend in the first half of the past 7 days. Due to the hawkish statements of the Federal Reserve and Powell’s negative impact on Bitcoin reserves, the lowest price fell to 92232 US dollars. After testing the low support twice on December 24th, it rebounded and rose to around $99958 for the day. During yesterday’s Christmas period, the US stock and futures markets were closed, possibly due to the holiday of most European and American traders, resulting in reduced trading volume and relatively narrower short-term volatility. Recently, it has been testing the upward trend in the early stage and experiencing wide fluctuations both online and offline, and it is also running around the control points of Coinank’s main chip distribution chart.From a four hour perspective, currently experiencing a potential double bottom pattern and testing neck resistance around $99500, it has fallen back. If it can break through in the later stage, it will be beneficial to continue the upward rebound. The upper resistance refers to $100300 and $102770, but if under pressure, it may retrace and test the lower support around $92520. Considering the recent inflow of BTC into exchanges and the relatively bearish trend after Christmas in the past, precautions can also be taken.
ETH market analysis:ETH rose from its highest point of $4105.47 in this round, but also fell to around $3101.73 due to the negative impact of last week’s hawkish statements by the Federal Reserve and the weakening of future interest rate cuts. On the evening of December 20th, the PCE index released by the United States fell to a five month low, and the decrease in the price index, which measures inflation, may affect the Federal Reserve’s future interest rate policy. Assets priced in US dollars, such as gold, US stocks, and cryptocurrency markets, which are bearish on the US dollar and bullish on the US dollar, also experienced an immediate reaction and rose. ETH rebounded to around $3554.4 before falling back and rebounding again in the afternoon. The short-term resistance above refers to $3554.4 and $3719.9, and if the pullback is blocked, the support below refers to around $3217.25 and $3101.73.
Analysis of altcoins:In the past 7 days, the overall decline of altcoins around December 20th has been relatively large, but their performance has been more differentiated. Weak altcoins have fallen to the level of the US presidential election day in November, while strong altcoins belong to a normal correction and have recently experienced a significant rebound. The Virtuals Protocol ecosystem, Pump.fun ecosystem, AI Agent Launchpad and other sectors have relatively high gains, and many related concept tokens have seen significant increases, with some coins showing doubled performance.
Options Market Analysis:In the options market, after the market experienced a washout last week, spot prices maintained horizontal fluctuations. This Friday, nearly $20 billion worth of Bitcoin and Ethereum options will expire, accounting for nearly half of Deribit’s total holdings. The expiration of options may trigger end of season volatility selling, especially when spot prices are sideways and sellers continue to roll short positions. If BTC breaks through $100000, the volatility may remain stable, otherwise altcoins may have a chance to catch up. Although the European and American markets are closed for the Christmas holiday, the cryptocurrency market has seen a significant increase driven by Bitcoin. Due to poor market liquidity during the Christmas holiday until the end of the year delivery period, the driving force required for price fluctuations is relatively small. In terms of options, the short-term implied volatility (IV) has decreased compared to the previous day, and market makers are nearing the end of their shift. It is expected that IV will remain stable before the end of the year. At present, the maximum option pain point for Bitcoin is at $84000, while Ethereum is at $3000. These annual maximum pain points may expire as in previous years.
Macro data analysis:On the evening of December 20th, the PCE and core PCE data released by the United States were all lower than expected. Relieve some investors’ concerns about a decrease in the number of interest rate cuts next year. A report from the US Department of Commerce shows that PCE, the inflation indicator favored by the Federal Reserve, rose 2.4% year-on-year in November, while economists’ expectations were 2.5%. Estimates based on consumer price index and other data indicate that in the 12 months ending in November, the PCE price index was an unexpectedly comprehensive cooling report, with the US dollar selling and the US stock, gold, and cryptocurrency markets rebounding as a result.
stablecoins analysis:Since the beginning of 2024, the total market value of stablecoins has increased by 48%. In the past 7 days, the overall market value of stablecoins has increased by 0.29% to $204.786 billion, with a short-term growth rate slowing down, which is consistent with the recent market trend and may be due to a decrease in short-term market demand.
Gas Fee Analysis:The average gas fee of Ethereum in the past 7 days has dropped to 4.58 Gwei, a significant decrease from last week, and the network activity has weakened. It may be affected by the OpenSea Foundation’s announcement that OpenSea is about to release coins, and the average gas fee of Ethereum network had previously risen to 54.3 gwei. Uniswap, CoinTool, and Tether are the three protocols that consumed the most ETH this week.
BTC data analysis:According to Coinank data, the Christmas price of Bitcoin in 2024 has more than doubled compared to last year, reaching $98200 in 2024, which is 392800 times higher than in 2010.We believe that the price of Bitcoin on Christmas Day in 2024 will reach $98200, more than double the price of last year and an increase of over 392000 times in 14 years. The astonishing growth in Bitcoin price reflects the maturity of Bitcoin as an asset class and the increase in market acceptance. This growth may be related to multiple factors, including a gradually friendly regulatory environment, approval of ETFs, and macroeconomic conditions such as expectations of Fed interest rate cuts, rising federal debt, and persistent inflation, all of which enhance the attractiveness of Bitcoin as a hedging tool. Institutional investors’ interest in Bitcoin continues to grow, with strong on chain fundamentals and historically low exchange balances, indicating increased confidence among holders who are increasingly choosing self custody. These factors work together to drive the continuous rise of Bitcoin prices, while also demonstrating the market’s recognition of Bitcoin’s long-term value storage position.
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