The sobering agent in the market frenzy: why do you need a 'topping guide'?
Every transition between bull and bear markets in the crypto market resembles a classic Wall Street script—'When shoe shiners are talking about stocks, it’s time to leave the market.' The craziness of Dogecoin's breakout and Musk's calls in 2021 is still fresh in our minds; now, with the approval of Bitcoin ETFs and institutional funds pouring in, the market is once again at the center of attention.
But historical experience tells us that the top of a bull market is often hidden in the most optimistic cheers. The recent market observation report released by crypto KOL Atlas systematically sorted out 10 key topping signals. These signals are not baseless speculation, but a common extraction from the major cycles of 2013, 2017, and 2021.
Complete解脱 of topping signals: a 10-layer filter from social sentiment to price behavior.
Level 1: Social psychology alert
The 'social attention caused by cryptocurrency' breaks through the circle.
When market aunties start asking 'how to buy Bitcoin', when celebrities showcase NFT holdings in variety shows, and even barbers analyze ETH trends while cutting hair—these seemingly absurd scenarios are typical signs of an overheated market.Classic case: In April 2021, American host Jimmy Fallon publicly showcased BAYC NFTs on 'The Tonight Show', and the market subsequently entered an accelerated topping phase.
The 'behavior of flaunting profits' floods social networks.
Suddenly, posts about 'account competitions' flood social circles, Telegram groups are filled with 'hundred-fold myth' screenshots, and KOLs start using the rhetoric of 'teaching you to easily achieve financial freedom' to attract attention—these behaviors essentially create 'fear of missing out' (FOMO). At this point, it is crucial to remain vigilant: when profit stories become social currency, it often means the buying power is about to diminish.Everywhere are 'crazy price predictions'.
From 'Bitcoin will reach $100,000 by year-end' to 'Solana's market cap surpassing Ethereum', exaggerated predictions will continuously strengthen consensus through the 'information cocoon' effect. However, data reveals the truth: Bloomberg shows that during the 2021 bull market, analysts' price predictions for BTC had an average deviation rate as high as 317%.
Level 2: Market behavior anomalies
The divergence trap of 'good news failing to push prices up'.
When major good news such as ETF approvals, mainnet upgrades, and institutional entries are announced, the currency price instead consolidates or even drops, indicating that the market has overdrawn expectations. This phenomenon is referred to in technical analysis as 'Buy the rumor, Sell the news', often appearing at the end of a market trend.The 'collapse of the upward trend': the silent warning of K-line patterns.
If the weekly level continuously shows 'long upper shadows', 'high position doji', or breaks key support levels (like the 20-week moving average), it may indicate a trend reversal. In November 2021, after BTC reached its historical high, it was the 'three consecutive downs' at the weekly level that ended the bull market.
Level 3: Distortion of investor behavior
The wave of full-time crypto trading from 'newbie investors resigning'
When more and more people around you believe that 'trading crypto is faster than working' and resign to monitor the market, it often means the market has entered an irrational phase. Chainalysis research indicates that when the proportion of newbie investors exceeds 40% in previous bull markets, the risk of market corrections sharply increases.The traffic code of 'Coinbase app topping the charts'
Coinbase surged into the top three financial apps in the App Store, exchange traffic skyrocketed by 500%, and the customer service system crashed due to an overload of account opening requests... These phenomena are essentially signs of exhausted incremental funds. When everyone has entered the market, the buying power is bound to weaken.
Which stage are we currently in? Practical deduction of the Atlas model
According to Atlas's monitoring framework, the current market has only triggered 1-2 primary signals (for example, the recent increase of 80% in Coinbase app downloads, but not yet in the Top 3). However, the following phenomena are worth noting:
Signal 9 'Reheated old projects' begins to emerge: Tokens like ICP and GMT, which have been dormant for two years, suddenly surge.
Signal 4 'Good news fails to drive up' appears locally: After the Ethereum ETF approval in June, the ETH/BTC exchange rate continues to decline.
However, from a macro cycle perspective, this bull market has structural differences:
Institutional funds enter through ETFs, unlike the retail-dominated markets of 2017 and 2021.
The Federal Reserve's interest rate cut expectations have not yet fully materialized, and the liquidity environment still has support.
Topping strategy: How to turn signals into decisions?
Atlas suggests adopting the '5 signal circuit breaker mechanism':
1️⃣ Establish your own signal checklist (select the 5 easiest indicators to track from 10 indicators).
2️⃣ When three signals are triggered simultaneously: reduce positions by 20%-30%, converting part of the profits into stablecoins.
3️⃣ When five signals are triggered: liquidate over 70%, retaining core positions to cope with extreme market conditions.
4️⃣ Always retain 10% of the base position: to avoid completely missing a black swan event (such as institutions suddenly increasing their positions).
Top players' consensus: find the 'third choice' between greed and fear
The co-founder of the crypto hedge fund NDV revealed the team's principles:
We never aim to sell at the highest point; instead, we start taking profits in batches when the market shows three topping signals. Earning 20% less profit to avoid 80% risk of a crash is the key to long-term compounding.
This may explain why top institutions have an annual average return rate stable at 200%-300%, while retail investors often fall into a cycle of 'wild fluctuations'.
Conclusion: The biggest risk in a bull market is forgetting that you are in a bull market.
History does not repeat itself simply, but it always carries the same rhyme. As the market gradually meets the warning conditions of the Atlas model, investors should be more alert not to the crash itself, but to the risk awareness dulled by the festive atmosphere.
As the old Wall Street saying goes:
'When the music stops, the question is not whether you can grab a chair, but whether you are willing to leave the dance floor.'#meme币狂欢 $ETH