$WCT To understand how important mass psychology is, consider what happens when we buy something? We pay for food, clothing? Why can we exchange pieces of paper or metal, which are worthless on their own, for real material values? The reason is psychology. People take money because they know they can exchange it for the things they need. If mass psychology stops working, money will become nothing.

Unfortunately, a person tends to see the market as they want to see it, rather than as it actually is. A trader buys a coin, and the price drops. Will they close the position at a loss? Quite often, even when there is not the slightest chance for growth, a trader clings to any news that supports their belief that the price will move in the desired direction. The market signals to us that the bullish period has exhausted, and the price can only continue to fall. Technical analysis allows us to look at the market situation objectively. Price formation depends on the psychology of people who remember old prices and rely on them. On one hand, people determine the price movement; on the other hand, prices dictate how people will move. Whoever receives information first sells or buys in advance.