A closely followed trader says memecoins and an additional crypto subsector are likely to outperform the rest during this market cycle.
Pseudonymous analyst The Flow Horse tells his 204,000 followers on the social media platform X that traders who made big gains on memecoins will likely rotate their capital to other crypto assets and trigger another round of altcoin rallies.
“Forget the wealth effect from Bitcoin or ETH. The profit taking on memecoin capital will create another alt cycle.”
Other than meme crypto assets, the top analyst is also bullish on altcoins that belong to the artificial intelligence (AI) subsector.
“Barbell AI and memecoins portfolio seems to be the [degenerate] play this cycle.”
While The Flow Horse sees big potential for AI and memecoins, he warns that the crypto markets are starting to flash signals of being overheated. The trader is looking at altcoin funding, which tracks the fees paid by crypto traders who hold futures or margin positions.
According to the crypto strategist, altcoin funding is hovering at an elevated level, suggesting that a correction to flush out overleveraged traders may be in the cards.
“I’ll just say this. The last time we were about to break an all-time high (ATH), we spent a month consolidating under the level. Alt funding was around this level but ended up doing 2x these values after ATH break.
BTC dropped 20%, and a lot of alts dropped double that.
Right now we have four sessions all trading within the same tight range. Expect some f*ckery.
You can always treat the market like the S&P [500] – long and strong above ATHs (Bitcoin in this case), and defensive below.”
Check Price Action
Follow us on Twitter, Facebook and Telegram
Surf The Daily Hodl Mix
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Generated Image: Midjourney
The post Memecoins and Another Crypto Subsector Offering the Best Plays This Market Cycle, According to Top Trader appeared first on The Daily Hodl.
