Cryptocurrency Market Trend Game Rules: See Through the Induction of Longs and Shorts, the Key is in This Step!
Recently, the market has shown a fluctuation characteristic of "daytime pullbacks and night market rallies," similar to the "pseudo-weak trend" from the end of April to early May—on the surface, it seems pressured and hard to break through, but in reality, it hides signals of trend accumulation. At this time, simply relying on technical indicators can easily lead to traps set by major players; the importance of trend background analysis far exceeds that of any single tool.
Core Logic: Trend Background Determines the Authenticity of Longs and Shorts
In an Uptrend, a Pullback is an Induction for Shorts
Characteristics: Short-term decline but not breaking key support, volume shrinks showing "passive pullback"
Strategy: Abandon short-selling mindset, focus on stop-loss signals at support levels (such as MA60, previous lows) (hammer line / bottom divergence), and wait for an opportunity to go long
In a Downtrend, a Rebound is an Induction for Longs
Characteristics: Brief surge but blocked by key resistance, volume-price divergence showing "impulsive rebound" Strategy: Reject the impulse to chase up, wait for reversal signals at resistance levels (such as MA30, previous highs) (shooting star / top divergence), decisively set up short positions
Deadly Pitfall: Discussing Technology Without Considering Trends
Many traders fall into "indicator superstition," stubbornly shorting based on RSI overbought in an uptrend, or chasing longs based on MACD golden crosses in a downtrend—this disconnection from trend background operations often becomes the target for major player liquidation. Trend background (such as weekly level increases, market capital flow) is the "weight indicator" for determining the nature of longs and shorts.
Practical Advancement: Build a Trend Trading System
Cycle Resonance: Use weekly charts to determine trend direction, daily charts to find entry opportunities, avoiding interference from small cycle noise
Volume-Price Verification: Pullbacks in an uptrend need to be accompanied by reduced volume, breakthroughs in resistance must be confirmed by increased volume; the opposite is true for downtrends
Position Management: Light positions for trial and error in the early stages of the trend, increase positions in the mid-term, gradually take profits towards the end of the trend