The LIGHT token experienced a rollercoaster market on December 21, reaching a high of $4.8 after landing on the Aster exchange's perpetual contract, and then plummeting 72% to $0.99. The 24-hour trading volume still reached $127 million, with a market cap falling back to $43 million and an open interest dropping 63%, making it the biggest loser of the day.

Bitlight is a Bitcoin Layer 2 infrastructure based on the RGB protocol and the Lightning Network, having completed $9.6 million in financing. Technically, it is committed to bringing smart contracts to the Bitcoin network, but the project is still in the early stages of development.

Analysis of the plunge indicates typical characteristics of a price spike followed by selling. The 1-hour RSI plummeted to 23.5, indicating deep overselling. The MACD histogram at -0.419 shows heavy selling pressure, with the price breaking below all moving averages. The ADX at 46.2 indicates a strong downward trend, and the CMF cash flow at -0.206 suggests significant selling.

Interestingly, the funding rate is positive at 0.23%, meaning long positions are paying fees to short sellers. This usually occurs after a price crash, as shorts take profits while longs are still bottom-fishing. Given the 1-hour RSI's deep overselling, a technical rebound may occur.

Warning on new coin speculation: The trend of LIGHT is a typical new coin listing pattern. The project team or market makers may drive up prices to attract retail investors, followed by high-level sell-offs. The 63% drop in open interest indicates a large number of leveraged long positions were forcibly closed. Such coins often complete their annual market cycle on the first day of listing.

Investors need to be cautious as newly listed tokens lack historical price references; valuations are entirely determined by speculation. Even if the project's fundamentals are strong, it may still experience a sharp decline in the short term. Bitcoin Layer 2 is a hot narrative, but LIGHT's current $43 million valuation is still high compared to mature projects like Stacks.

Is it worth bottom-fishing? From a technical perspective, the lower support at $0.50 is in place. If a rebound occurs, the 1.35-day Bollinger Band midline can be considered, but the risk is extremely high. It is recommended to use only 2-3% of the portfolio to speculate on a rebound, with a strict stop-loss set at $0.50. Conservative investors should steer clear of such high-volatility new coins and wait to assess the project after it develops actual applications and users. Rebounds after sharp declines are often opportunities for secondary selling; avoid heavy gambling.