Many people watching the market tend to latch onto one point and not let go. Some focus only on technicals, some only look at sentiment, and others fixate solely on the so-called 'cyclical time points'. Theoretically, this is not wrong; the second year after Bitcoin's halving is often the end of the bull market. But if this is taken as the sole criterion for judgment, the conclusion can easily go astray.
Let's first rewind to 2021. The reason that bull market was so smooth, apart from the halving cycle, was the macro environment. The Federal Reserve released a large amount of liquidity at that time, cutting rates and providing support to the market. But by the end of 2021, the situation took a sharp turn: inflation data soared to a 40-year high, unemployment rates quickly fell, and the Federal Reserve began to clearly signal interest rate hikes. The dot plot in December showed that almost all committee members supported rate hikes, and the market quickly realized that a tightening cycle was coming in 2022. Thus, the end of the bull market and expectations of rate hikes appeared almost simultaneously. This is the 'perfect overlap' of cycle and macro in 2021.
Now let's look at the present. Many people are calling for a bear market, citing the second year after the halving, but they overlook one thing: the macro environment is completely opposite to that of 2021. At the end of 2021, the interest rate hike cycle was just about to begin, whereas now we are in the middle of a rate-cutting cycle. The Federal Reserve's predictions for interest rates over the next two years continue to be revised downward; even conservatively speaking, interest rate hikes won’t return until at least 2026. In other words, the liquidity extraction machine has been temporarily turned off, and the market is still enjoying the tail end of easing.
So the question arises: when the 'cyclical rules' and 'macro environment' clash, which one should be trusted? I tend to view it this way—cycles do represent a long-term rhythm, but macro policies determine the current elasticity. In 2017, the Federal Reserve was reducing its balance sheet, yet Bitcoin still completed its bull market, which shows that policy does not always directly end a trend. By 2021, however, both macro and cycle hit the brakes together, and the bull market truly came to a halt.
So looking ahead to 2025, the situation is much more complex than in 2021. Bitcoin is still near new highs, Ethereum is gradually starting up, but altcoins are clearly lagging behind, and the integrity of the cycle has already shown cracks. In past bull markets, altcoins would at least ride along for a while, but in this round, their performance is noticeably weaker—that's what makes it 'different'.
Specifically for operations, the thought process can be divided into several categories:
The first type is the cyclical faction. If you believe that the second year after the halving is the end of the bull market, then actions should be decisive: the core idea is to gradually reduce positions upon seeing new highs in Bitcoin and Ethereum, avoid fighting, and be particularly cautious with altcoins—liquidate your positions if the winds shift. The advantage of the cyclical faction is that the discipline is clear, preventing emotional deviation, while the disadvantage is that if this bull market is extended by macro factors, you may miss out on significant gains.
The second type is the macro faction. If you value the pace of the Federal Reserve's interest rate cuts, then the approach should be relatively patient: you can continue holding high-certainty assets like Bitcoin and Ethereum, with a moderate allocation to altcoins, but don't take too large of a position. When the Federal Reserve signals interest rate hikes again, consider taking profits. The advantage is the possibility of benefiting from an extended bull market, while the disadvantage is that if the cycle ends early, the pullback could be painful.
The third type is the hybrid faction, which is actually suitable for most people. The approach is to layer positions: reduce some under the cycle logic and keep some under the macro logic, so regardless of what happens, the mindset can remain relatively stable. For example, hold Bitcoin and Ethereum as a long-term base, with the altcoin position split into two parts—one part for short-term trading and the other for macro speculation.
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