Bitcoin (BTC) Market Enters Phase Two of Altcoin Rally, But Faces Conflicting Signals

Cryptocurrency markets faced conflicting signals on Friday, with multiple indicators pointing to different directions.

The Bitcoin Accumulation Trend Score dropped near zero, indicating that large holders were either selling or pausing new purchases.

This metric usually helps gauge market sentiment among substantial investors, and the current reading suggests caution at higher price levels.

Adding to the market uncertainty, a Bitcoin wallet that had been dormant for six years became active again, transferring 500 BTC (around $47 million at the time of writing) to Coinbase Prime.

The wallet initially received these coins when Bitcoin traded at $7,000, representing a substantial profit at current prices.

Such movements from old wallets often precede increased market volatility.

Economic Data, BTC Response

The latest US Non-Farm Payrolls report showed that the country’s economy added 256,000 new jobs in December versus the predicted 164,000. The unemployment rate came in at 4.1%, better than the forecast 4.2%.

These numbers typically support asset prices, yet Bitcoin faced selling pressure after the release.

Analyst Karan Singh Arora attributes this disconnect to market manipulation rather than fundamental factors.

This jobs data creates an interesting dynamic for crypto markets. Strong employment numbers could lead the Federal Reserve to maintain higher interest rates longer, potentially limiting crypto price gains.

However, the data also shows economic strength, which often supports risk assets like cryptocurrencies in the longer term.

CryptoElites sees the market entering the second phase of a major altcoin rally. This view aligns with historical patterns where Bitcoin price stability creates conditions for altcoin growth.

The analyst emphasizes patience during this transition, noting how early sellers often miss the largest gains during altcoin cycles.

Trading Implications, Market Phases

The current market setup requires careful positioning and risk management.

With large Bitcoin holders pausing accumulation and old wallets becoming active, traders may face increased price swings.

These conditions often create opportunities in altcoins as capital rotates between different market sectors.

For risk management, several key price levels should be noted. Bitcoin needs to maintain support above recent lows to keep market confidence intact. A break below these levels could trigger broader market weakness.

However, as long as Bitcoin holds its range, altcoins may continue their upward pattern regardless of short-term Bitcoin price moves.

The movement of old Bitcoin wallets offers perspective on market cycles. These early investors bought Bitcoin at $7,000, held through multiple cycles, and are now taking profits at $94,000.

This pattern of long-term holders selling into strength typically marks mid-cycle periods rather than major tops, supporting the case for continued upside in 2025.