🔥I have been in the cryptocurrency space for 5 years and have summarized some commonly used experiences that I hope will be helpful to everyone!
1. Fast Rise, Slow Fall: Signal of Accumulation by Big Players
• Characteristics: Rapid price increase followed by a slow decline.
• Underlying Logic: Big players create a strong market by rapidly driving up prices to attract retail investors, then slowly pull back to accumulate at lower prices, preparing for the next surge.
• Operational Suggestions:
• Observation Signals: If the price rises quickly and the pullback is limited, it may indicate that big players are accumulating chips.
• Response Strategy: Be patient and pay attention to continuous signs of accumulation at low points.
2. Fast Fall, Slow Rise: Signal of Distribution by Big Players
• Characteristics: Sharp declines create panic, followed by a slow increase in price.
• Underlying Logic: Big players hit the market hard to undermine confidence while gradually selling off their holdings at high prices.
• Operational Suggestions:
• Observation Signals: High-level fluctuations or gradual price declines, with trading volume unable to sustain increases, indicate insufficient upward momentum.
• Response Strategy: Avoid chasing highs and watch for exit signals.
3. Volume Patterns at the Top: The Game of Volume and Price
• High Volume, Don't Rush to Sell: High trading volume at the top may indicate that big players are attracting buying interest, and the cryptocurrency may still have room to rise.
• Low Volume, Quick Exit: If trading volume shrinks at high levels, it indicates weak buying interest, and prices may pull back.
• Operational Suggestions:
• If volume and price rise simultaneously at high levels, there may still be space for growth.
• If volume shrinks, immediately reduce positions or take profits.
4. Volume Patterns at the Bottom: Key Signals of Reversal
• Caution with Sudden Volume Increase: A sudden increase in volume at the bottom may be a false rebound, with big players taking the opportunity to distribute.
• Continuous Volume Increase is Buy Signal: If trading volume continues to rise at the bottom, capital is flowing in, which may signal a reversal.
• Operational Suggestions:
• Focus on the continuity of trading volume rather than a one-time anomaly.
5. Speculating on Cryptocurrency is Speculating on Human Emotion: Market Sentiment is Key
• Sentiment and Trading Volume: Market sentiment is directly reflected in trading volume; an increase in volume indicates heightened market sentiment, while a decrease may indicate cooling.
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