Is the New Year Pump FOMO Back, or Is It Alt Season Again?

Original Article Title: "Early Year Speculation Sentiment Resurges, Crypto Shitcoin Season Replay?"

Original Article Author: Wenser, Odaily Planet Daily

At the beginning of the new year, the crypto market saw a rare upward breakthrough, with BTC successfully breaking free from the $90,000 key resistance level, and mainstream coins such as ETH and SOL finally rising above $3,100 and $130 respectively. What is even more astonishingly described as a "bull comeback" is the rapid rebound of many shitcoins in recent days—coins like PEPE, IP, WLFI, etc., have seen their prices surge by over 20%.

Of course, the time is still short, and whether the "early year shitcoin season," as seen in previous years, will once again be staged remains uncertain. However, amidst the complex macroeconomic and geopolitical situation, whether cryptocurrency can take over from precious metals and stage a "meteoric rise miracle" as usual is already worth looking forward to. In this article, Odaily Planet Daily will provide a brief review and analysis of the current market situation and representative views.

Analysis of 3 Key Market Indicators: The Shitcoin Season Has Not Truly Arrived, Currently in a "Partial Rebound"

Aside from the overall market trend, based on the current data, it is challenging to conclude that the "shitcoin season has returned." Looking at the rankings on the exchange platform for price increases, many tokens showing a rebound are previously oversold assets, highly manipulated meme coins, or trending concept coins. Based on the following 3 key data points, the cryptocurrency market is still in a slow "price recovery period."

Indicator One: Cryptocurrency's Overall Market Cap Has Not Significantly Recovered

According to Coingecko data, the current cryptocurrency market cap stands at $3.19 trillion, with BTC dominance at 57% and ETH dominance at 11.9%.

There is still a gap of over $1 trillion from the previous high market cap of over $4.3 trillion. This is not only due to the significant drops in mainstream coins like BTC, ETH, SOL, BNB from their peaks, but also a result of many shitcoins facing price declines and reduced trading activity amidst liquidity constraints and continuous outflows of on-chain funds.

It is evident that there has been no significant improvement in the overall cryptocurrency market environment.

Indicator Two: Shitcoin Season Index Remains at a Low Level

According to the Coinglass Shitcoin Season Index, the current market's shitcoin season index is at 39, comparable to the market index in mid-July last year. At that time, the market was still on the eve of the DAT Treasury Company's eruption, with various mainstream and shitcoin coins at relatively low points. Subsequently, with the continuous expansion of the DAT Treasury-listed companies, ETH led the way to new highs. However, compared to the incremental buying pressure brought by the listed companies at that time, the market's liquidity has now shrunk to a certain extent.

Indicator Three: Market Sentiment Still in Fear Zone

According to the Coinglass website, the Crypto Fear and Greed Index is currently at 26, in the fear zone; this zone also has the largest market sentiment share, accounting for a total time percentage of 30.86%, more in line with a bearish market sentiment.

Looking at the above indicators holistically, the market is still in a tepid phase, but does this mean there are no opportunities for wealth creation? The mainstream view of the market clearly does not think so. On the contrary, many institutions and individuals point out that the current situation may be a good buying opportunity, and the main support logic for this is the expected improvement in liquidity and macroeconomic progress. As the saying goes, "Be greedy when others are fearful," of course, the premise is to choose the right target.

3 Major Signs of Market Reversal: Liquidity Improvement, BTC Taking Over Precious Metals, and Retail Investor Sentiment Remaining Rational

Currently, the mainstream market view has a certain consensus on the short-term bottoming rebound, but the real turning point may depend on the increase in market liquidity, BTC's market performance, and the shift in retail investor sentiment. The following are representative views of the current market:

Global Market Liquidity Expected to Rebound Next Week, On-Exchange Gaming Driving Short-Term Rebound

Danske Bank's FX and rate strategist Jens Naervig Pedersen stated in a report that global market liquidity is expected to remain subdued this week, but with more economic data releases, it may rebound next week. During the year-end period, many market participants are on vacation or closing positions, leading to generally low market liquidity.

Key data for next week includes important US labor market data, such as the December non-farm payroll report released on January 9, and ISM surveys.

CoinKarma also reported that the cryptocurrency market is currently back in the on-exchange gaming stage, with on-exchange factors becoming key to short-term price fluctuations. In the absence of clear external incremental funds, the cryptocurrency market relies mostly on on-exchange fund circulation, and short-term price fluctuations stem from on-exchange fund flows and overall liquidity changes.

Furthermore, through the USDC/USDT Premium (measuring the USDC premium relative to USDT) and Overall LIQ (overall market-weighted liquidity index) observations, it is noted that when the USDC/USDT Premium turns positive, reflecting a weakening of active selling behavior by market-dominant funds on BTC/USDT. Currently, USDC/USDT Premium and Overall LIQ are resonating again, with a high probability of a short-term bottom rebound. CoinKarma also points out that compared to the previous phase, the current medium- to long-term trend still leans bearish, requiring attention to potential selling pressure.

Precious Metals Price Correction, BTC Might Take the Baton for Upside

After gold and silver staged another price surge last month, many industry players and analysts are now looking at cryptocurrencies, including BTC, as the next liquidity relay runner after their price corrections.

TD Securities' Senior Commodity Strategist Daniel Ghali stated that in the next two weeks, up to 13% of the total open interest in the New York Comex silver market is expected to be sold off, leading to a significant repricing and downturn, with post-holiday low liquidity potentially amplifying price swings.

Delphi Digital, on the other hand, expressed that the price of gold has risen by 120% since the beginning of 2024, marking one of the strongest historical surges, and as gold historically leads Bitcoin by about three months at liquidity inflection points, this trend has implications for cryptocurrencies. Gold has now completed its repricing of the loose monetary cycle, while Bitcoin sentiment is still influenced by past cycle analogs and recent pullbacks. The performance of precious metal assets is signaling policy easing and fiscal dominance, pricing the market for currency debasement rather than growth collapse when precious metals outperform stocks. The volatility in the precious metals market may serve as a signal for the subsequent trend of other risk assets.

The agent of the "October 11 Whale Insider," Garrett Jin, also wrote that, as previously analyzed, the prices of gold and silver have already peaked. After the U.S. market opened today, funds have started flowing into the cryptocurrency market, with cryptocurrencies continuing to rise even as the stock market sees selling pressure after the opening. The inflow of funds may persist, accelerating the upward momentum, triggering a short squeeze without a significant pullback.

Retail Investor Sentiment to Become a Key Market Change Indicator

Blockchain analytics platform Santiment analyst Brian Quinlivan pointed out that the cryptocurrency market participants showed strong sentiment on social media early in the year, but also warned that whether the market can further rise depends on whether retail investors can remain rational. He stated that Santiment's social media data shows that current retail sentiment is very positive,

"This is usually a bit worrying, but this time it may just be a normal rebound after the holiday return."

Quinlivan stated that he is not overly concerned about "a surge of FOMO sentiment," but added that if Bitcoin rapidly climbs to $92,000, this sentiment may enter the market. When the market is too excited, the cryptocurrency market often moves in the opposite direction of what most people expect.

Market Sentiment Divergence, On-chain vs. Off-chain Funds Diverge

Looking at the current market sentiment, the current ETF trading attitude remains cautious, in stark contrast to the optimistic attitude of on-chain funds in the crypto market.

Over $900 Million Net Outflow from BTC ETF in the Past 3 Weeks

Yesterday, the price of Bitcoin rose to above $90,000 today, reaching a near three-week high. However, the flow of funds in derivatives and spot ETFs shows that traders still hold a cautious attitude, indicating limited market confidence in further price increases. Despite the price rebound, the demand for Bitcoin leveraged long positions remains stable, the Bitcoin futures basis rate is below the neutral threshold, and the current annualized premium is 4%. Bitcoin spot ETFs have seen over $900 million in net outflows since December 15, and Bitcoin put options traded at a premium on Saturday, indicating an increase in professional traders' demand for downside risk protection.

DOGE, PEPE Driving Meme Coin Surge, IP, ZEC, WLFI Leading Oversold Rebound Sectors

Recently, Dogecoin and PEPE led a wave of Meme coin price surges early in the year. Some analysts believe that momentum traders are chasing a familiar pattern: once liquidity returns, speculative funds flow from large-cap coins to meme coins. Currently, major Meme coin prices are surging, including PEPE, DOGE, SHIB, WIF, FLOKI, etc.;

"Popular concept" tokens such as IP, ZEC, WLFI have experienced a significant decline before, and after the new year, they have rebounded combined with relevant news and market fundamentals;

In the AI concept token sector, tokens like RENDER, PIPPIN are still actively trading, with both spot and contracts showing impressive gains of over 15%.

Overall, the biggest variable in the crypto market appears to still focus on this month's macroeconomic data and the nominee for the new Federal Reserve Chair nominated by Trump. Before that, bargain hunting is possible, but try to choose short-term trading and avoid getting too excited.

BTC End-of-Year Price Prediction Contest Begins, Main Range $120K-$170K

Finally, we will conclude with the existing BTC price prediction as the end of the article, also as our expectation for this year's upward trend.

The Telegraph published an article titled "Bitcoin Volatility Fades as Speculative Nature Declines," pointing out that Bitcoin's sharp rise in 2025 is different from previous years. The key reason is the widespread adoption of ETFs. The recent price pullback is not as large as in the past four or five years. This change may be related to the influence of macroeconomics on traditional fund operation logic. There are two opinions in the market about Bitcoin's trend in 2026. Some believe that Bitcoin may experience a significant pullback, even returning to a lower price range, while other investors are bullish on Bitcoin reaching $150,000 by the end of the year and expect it to hit $250,000 in 2027.

Forbes published an article titled "Bitcoin Price Prediction for 2026," pointing out that there is currently a wide range of publicly available Bitcoin price predictions for 2026. Analysts such as Tom Lee, Standard Chartered Bank, and Bernstein are bullish, but some institutions are bearish. Although there is no single target price for Bitcoin in the market yet, predictions are concentrated in the range of $120,000 to $170,000. This indicates that Bitcoin's price discovery is increasingly affected by structural factors such as ETF fund flows and corporate treasury assets. If macroeconomic bullish factors strengthen and institutional participation accelerates, the potential for upside could reach $250,000 or higher. How institutions choose to deploy capital will be a key factor in Bitcoin's price increase.

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