🔥 Benjamin Cohen on the peaks of market cycles: the 200-day moving average and important nuances 🔥
According to analyst Benjamin Cohen, historically, the peak of the market cycle occurs when the 200-day moving average crosses the level of the previous cycle's peak. This is not just a technical signal — it is a powerful indicator of a shift in market sentiment and the balance of power between buyers and sellers. ⚖️
Why specifically the 200-day moving average?
📈 It is considered one of the key lines in technical analysis, smoothing out strong fluctuations and showing the long-term trend. When the price or the 200-day average reaches or crosses the level of the previous maximum, it indicates that the market may be ready for a reversal. 🔄
It is important to remember the nuances:
1️⃣ The signal does not always trigger immediately. Sometimes the 200-day can 'stall' near the peak, giving false breakouts. Therefore, always look at confirming factors — volumes, other indicators, the overall market context. 👀
2️⃣ Markets change, rules adapt. For different assets and at different times, behavior near the 200-day can vary. In volatile markets, breakouts happen more often, so additional filters are needed. 🔍
3️⃣ Trading volume is a key factor. The crossover should be accompanied by an increase in volume — this is a sign that large players are active, and the signal becomes stronger. 💥
4️⃣ Considering macro and fundamental factors. External events, central bank policies, news — all of this can amplify or weaken the signal's significance. 🌍📊
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Conclusion:
🧠 Monitoring the 200-day moving average at the peak of the previous cycle is very helpful for understanding the market reversal moment. But for accurate analysis, be sure to use a comprehensive approach — combine technical indicators and fundamental data.