Recently, the backend has been flooded with questions like, "BTC's market share is nearing 65%, should I liquidate?"—many people are fixated on the old saying that "65% = dangerous signal" and are hovering over the sell button. But I have to be honest: this indicator really shouldn't be applied rigidly. Last year, a fan stubbornly followed this rule, sold BTC, and then watched altcoins rise 3 times, hitting their thighs in regret; others waited until 65% to sell, only to find that altcoins had already halved.
Today, let's break this down: two situations correspond to two actions, and after reading this, you'll at least avoid one major pitfall.
One, first understand: why does "65%" become a "signal for avoiding the top"?
This saying originated from the bull market in 2017: back then, when BTC rose, capital would all rush to Bitcoin, and the market share would soar above 65%. When capital started to flow into altcoins, BTC would correct. But now the market has changed; just looking at this one number can easily lead to misjudgment.
Two, the two situations are vastly different! To sell or not, look at these two points.
Situation one: BTC is soaring, while altcoins are still "lying flat"—at this time, you can take partial profits.
Just like in May of this year: BTC rose from 60,000 to 72,000, and its market share surged from 58% to 66%, but ETH was still hovering around 2,200 dollars, while small altcoins generally fell by 10%-20%. At this time, capital was clearly "grouping around BTC"; once the hype passed, it would likely flow towards mainstream coins like ETH and SOL.
Last year, a fan got it right: sold 30% of BTC at 65%, then bought ETH that hadn’t risen yet. Later, ETH rose 80%, while BTC fell 5%—in this case, it was completely fine for BTC holders to take partial profits.
Situation two: End of bull market, altcoins have already surged once—at this point, 65% might be the "signal for the last drop."
The most typical at the end of the 2021 bull market: From September to November, altcoins soared (many increased by 5-10 times), and BTC's market share dropped from 62% to 45%; by November, as the market was about to end, altcoins began to plummet, while BTC experienced a "final surge" and the market share returned to 67%. Selling BTC at this point seemed like avoiding the top, but in reality, it was too late to cash out on altcoins—an experienced player I know sold BTC only when the market share reached 65%, but by then, the altcoins he held had already dropped 60%, and selling BTC didn’t make up for the losses.
The key difference: In the early stage, 65% means "capital hasn't been diverted"; in the later stage, 65% means "capital is fleeing back." If you rashly liquidate BTC in the early stage, you might miss the "final opportunity to board" before altcoins take off; looking at 65% in the later stage, the data is already lagging.
Three, don't let indicators "hijack" you! These three points are more important than 65%.
Just focusing on market share is useless; you need to look at these three dimensions together to avoid making mistakes:
Look at altcoin activity: If BTC's market share is 65%, but the trading volume of mainstream coins like ETH and SOL hasn't dropped, or is even quietly increasing, it indicates that capital hasn't exited; it's just temporarily grouped together, so there's no need to rush to sell. If the trading volume of altcoins continues to shrink, and even popular concept coins are inactive, then you need to be cautious.
Looking at the cycle position: Early bull market (like now), even if the market share reaches 65%, it is likely a "temporary high point" and not the real top; Late bull market (for example, when altcoins generally rise more than 3 times), a market share rebound to 65% is a dangerous signal.
Don't believe in "absolute points": During this bull market, some said, "BTC's market share at 70% must collapse" or "60% must rise," but what actually happened? In March, the market share reached 63%, and BTC didn't drop but instead rose by 15%; in May it reached 66%, and it just consolidated without collapsing—markets change, and old indicators can't be rigidly applied.
In the end, let’s be real: indicators are references, not commandments.
All indicators have lagging characteristics. For example, when the Federal Reserve suddenly cut interest rates last time, BTC's market share dropped 3% in one day, and no one predicted it in advance. Trading is like driving; market share is just the "rearview mirror"; you need to consider the "road conditions ahead" (capital flow, altcoin activity) and the "weather" (macroeconomic policy) together. You can't just focus on the rearview mirror while driving.
Last year, over 300 fans rigidly applied the "65% avoid the top" rule, resulting in either missing out or getting trapped. In fact, the simplest approach is: don't treat a single indicator as a "lifeline"; look at trading volume, mainstream coin trends, and combine them with your own position (light holdings can withstand, heavy holdings should diversify) for a more reliable strategy than blindly following numbers.
Let's discuss in the comments: Have you ever missed out or been trapped because you believed in a certain "top-avoiding indicator"? Follow me, and I'll teach you how to combine "market share + trading volume" to judge true tops and bottoms, which is 10 times better than relying on a single indicator!
