Insight into the Sector Rotation Pattern Following Ethereum's Lead

Original Author | @0x Artikal

Compiled by | Odaily Planet Daily（@OdailyChina）

Translator | DingDang（@XiaMiPP）

This article is compiled from two tweets by @0x Artikal, assembled by Odaily Planet Daily. With the current market heat continuing to rise, this article attempts to provide readers with observations and judgments from market participants from the perspective of capital flow and cycle evolution, listening to the voice of the market. The views in the article are for reference only and do not constitute any investment advice.

Bitcoin broke through its historical high, with the price once reaching $123,000.This trend has caused a divergence in the market: some investors are bullish up to $200,000, believing there is still room for growth; others think it is close to the cycle top and suggest taking profits.

But more noteworthy than these market sentiments is the data itself. Analysis of trading behavior and capital flow shows that the current market is far more complex than it appears on the surface.

While BTC surged to a new high, the behavior of large accounts on Binance changed significantly. The whale activity indicator suddenly rose, showing that market sentiment might be shifting. In just one day, over 1,800 BTC net flowed into Binance, meaning a large amount of capital is moving to more liquid trading platforms.

Further observation found that over 35% of these inflows came from single transactions exceeding $1 million, clearly not the work of retail investors. A large amount of data indicates that this is a collective response behavior of several large accounts to the new high, with strong coordination.

Additionally, the data shows that most of these transferred coins were held for less than three months, indicating strong speculative intent. But at the same time, some long-term holders who held coins for over a year also transferred tokens to exchanges, casting a layer of uncertainty over the market's future direction.

The first is typical profit-taking. Transferring BTC to exchanges immediately after the price hits a new high likely means investors intend to cash in on profits. This operation is not uncommon; they often tend to lock in profits at highs and then look for opportunities to re-enter the market. If this trend continues, the market may experience a mild correction in the coming days.

The second possibility is more strategic. These large capital movements may be for risk hedging or leveraging Binance's deep liquidity to establish leveraged positions. This means these large accounts may expect further market volatility and are preparing for the next round of market movements. If this is the case, even if there is a short-term adjustment, its amplitude may be small, and the market is expected to quickly rebalance.

More notably, this wave of capital flow involves both short-term speculators and long-term holders, indicating that it is likely a synchronized execution of some strategy by multiple large participants. In just one day, over 1,800 BTC were transferred to Binance, which has a non-negligible impact on the platform's short-term liquidity and significantly increases the market's sensitivity to large orders.

These whale operations are likely out of strategic considerations, aiming to seize the trend inflection point. At such critical psychological nodes, the collective actions of large accounts often exert pressure on retail sentiment. As prices hit new highs, market sentiment swings violently between excitement and tension, further catalyzing the speculative atmosphere and increasing the probability of short-term volatility.

At the same time, Binance's overall liquidity is also rising, attracting more institutional traders to enter the market. For these professional players, the ability to quickly establish positions and flexibly close them is particularly crucial. At this stage, whale behavior almost determines the market's overall sentiment and price direction. Therefore, for all investors, closely tracking capital flows, especially real-time large transfers, is particularly important.

Whether the market chooses to correct or continue to fluctuate upward, one thing is certain: current volatility is rising, and risks are intensifying. Any slight change in sentiment and liquidity is almost immediately reflected in prices. The entire market is in an extremely sensitive period, where even minor events could become the trigger for a market explosion.

We have previously witnessed how just one large account's operation on Binance triggered a new round of Bitcoin breakout. This fully demonstrates the decisive impact of large capital behavior on market structure.

For long-term investors, this may not be a signal to "sell and flee," but more like a test of trend resilience. A large amount of BTC transferred to exchanges is likely just strategic repositioning, not a large-scale retreat. Of course, short-term violent fluctuations are almost inevitable and may also be a window for reallocating assets and optimizing positions.

Currently, the market is in a delicate balance: profit-taking and strategic deployment coexist. In the coming days, the movements of large accounts on Binance and changes in the overall liquidity environment will continue to dominate the market rhythm. Investors need to remain highly vigilant and always be ready to adjust strategies based on market dynamics.

After all, Bitcoin is still in the spotlight, and its every move still affects the nerves of the entire crypto market.

Note: This tweet was posted on July 17, 2025

While BTC leads the price breakthrough, ETH is beginning to show signs of relative strength. From the ETH/BTC trend, the exchange rate has broken through the oscillation range of several months, which is the first signal of the formal start of the rotation structure.

Generally, market rotation unfolds along this path: BTC leads → ETH follows → high-cap coins catch up → ultimately leading to a full altseason. And ETH is outperforming BTC, indicating that market liquidity is flowing from the BTC-dominated structure to the next stage represented by ETH.

BTC usually initiates the offensive first, and when ETH starts to follow, or even performs stronger, it represents a broader willingness of funds to take higher risks. ETH is not just ETH; it is also a "bridge" to DeFi and other altcoins. Its strength means the recovery of confidence in the entire market.

After ETH gains momentum, high-cap projects like SOL, XRP, ADA have陆续出现强劲买盘, they usually serve as "index-type" alternative bets after ETH. Once these coins start, funds will continue to flow to medium-cap projects below $1 billion, retail attention surges, and market narratives change daily. Traders accelerate capital rotation to seek higher Beta returns.

Mining coins (e.g., DCR) usually start to follow only after medium-cap coins initiate, at which point the market enters a highly reflexive state: the more prices rise, the more inflows, and the more inflows, the faster prices rise. This stage is the breeding ground for Memecoin's最容易爆发短期抛物线行情的温床.

This entire rhythm is essentially a natural chain of "liquidity sinking." Starting with BTC leading the rise, funds migrate step by step: ETH, mainstream alts, medium-cap coins, then to Meme and small-cap tokens. In this process, volatility and market acceleration continue to increase.

Structurally, we are standing at the starting point of the "ETH stage": rotation has just appeared, not yet overheated, and the opportunity window is still open. ETH's strength will further push liquidity to continue sinking, and retail FOMO sentiment has not yet been fully ignited. The Fear and Greed Index remains at 60–65, still some distance from extreme sentiment. This also means there is still enough room for this cycle to rise.

The direction of the entire market is very clear: BTC has lit the fuse, ETH is taking over to accelerate, and high-cap coins will quickly catch up. After that, the real full altseason will arrive as scheduled, with medium-cap coins, Memecoins, and various concept coins taking turns to perform, until all liquidity is exhausted.

ETH's leading performance is not only a confirmation of the trend but also the starting point of the next stage.