In recent weeks, the cryptocurrency market has perfectly replicated the classic script of 'leading cryptocurrencies leading the way, followed by secondary ones catching up': Bitcoin first broke new highs, followed by Ethereum quickly rising, leading many to start grappling with 'which one to chase' and 'will it hold its position.' In fact, I predicted the rhythm of this sector rotation from several industry news pieces a month ago and positioned myself in Ethereum-related assets in advance, and my returns have already outperformed the market average by 30%.
The core insights are here: The rotation in the cryptocurrency sector is never random; it follows the principle of 'money moves with the news.' A month ago, I saw two key pieces of news: first, a leading tech company announced that it would develop decentralized applications based on the Ethereum Layer 2 protocol, which means that Ethereum's ecosystem applications need further expansion; second, the Ethereum Foundation released the latest upgrade roadmap, clarifying the timeline for lowering Gas fees and improving transaction speeds. Together, these two pieces of news send a strong signal: Ethereum's fundamentals are continuously improving, and funds are likely to shift from Bitcoin, which has already surged, to Ethereum, which has clear positive news.
Looking at historical patterns, every bull market has a fixed rotation rhythm: first, Bitcoin rises as a 'barometer,' attracting new capital; next, funds flow to second-tier blue chips like Ethereum, as they have mature ecosystems and technological support; finally, altcoins and niche assets begin to catch up. However, this time, there is a different point: institutional funds prefer assets with compliance expectations and practical applications, so the rotation speed will be faster, leaving little opportunity for latecomers.
My operational idea is: after Bitcoin breaks through $120,000, I will gradually reduce my Bitcoin holdings and allocate 50% of my funds in batches to Ethereum and Ethereum Layer 2 related assets. I chose Layer 2 because the news about the technology company's cooperation clearly mentioned the application scenarios of Layer 2, which is the most direct good news. As expected, a week later, Ethereum began to gain momentum, and some assets in the Layer 2 sector even rose by more than 50%. Those who waited until Ethereum skyrocketed to jump in either ended up standing at high prices or were scared out by short-term corrections, perfectly missing the opportunity for profit.
Many people fail to grasp the core of sector rotation because they only focus on price fluctuations and ignore the 'news logic' driving the market. Remember: 'application rollout,' 'technology upgrades,' and 'institutional cooperation' in the news are all 'guiding sticks' for capital. To succeed in sector rotation, you need to learn to 'ambush in advance,' rather than 'chase high prices afterwards.'
Next, everyone can focus on two main lines: one is the sector related to Ethereum upgrades, and the other is DeFi protocols with real trading volume. There are already news reports that some institutions are researching quality assets in the Ethereum ecosystem, which is likely to be the trigger point for the next wave of market action. Follow me, and I will continue to track sector opportunities in global news to help you avoid the pitfalls of chasing high prices and panic selling. After all, in the cryptocurrency market, choosing the right sector is more important than effort; wouldn't you agree?
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