Although the global economic outlook remains shrouded in uncertainty, the crypto market has already shown signs of recovery, combined with the expectation that the U.S. stock market is likely to start a strong rebound in the summer. Leading crypto assets such as Solana (SOL), Binance Coin (BNB), and Sui (SUI) may become the pioneers of this market cycle.
Can crypto assets continue their summer offensive?
When assessing the trends of the crypto market in summer and even year-end, two key variables must be considered: first, the fragility of the global geopolitical economic landscape continues to intensify, and the probability of black swan events is rising exponentially; second, traditional finance and the crypto market have just undergone a deep valuation correction, and the momentum for a technical rebound is accumulating. Unless the global economy falls into a new round of great depression (this systemic risk cannot be completely avoided), the market still has room for valuation recovery.
It is worth noting that if Bitcoin can continue its current bottoming rebound trend, it will effectively activate the overall liquidity of the crypto market. Among these, the Layer1 public chain track, as a fundamental infrastructure, may become the core engine of this market cycle due to its network effects and technological iterations. Projects like SOL, BNB, and SUI, which combine technological innovation and ecological vitality, are most likely to break through first in the process of value discovery.
SOL is far ahead.
In the past week, the price of SOL has been in a leading position. It has risen 40% from a low of $94, when many were worried that the correction would persist. Now, the price has successfully turned the resistance level of $128 back into a support level, which was confirmed on Sunday.
The next target is the local high point, which is also a horizontal resistance level at $148. If this point is broken, the downward trend will be broken, opening the path to the major resistance level of $180.
The bulls for BNB are about to break the downward trend line.
The price of BNB is still in an upward trend on a macro level and is very close to breaking the local downward trend that has persisted since early December 2024. Important support may lie at $584, and the bulls still need to continue pushing and breaking the downward trend line.
At the bottom of the chart, the stochastic RSI indicator is forming an upward crossover, indicating strong upward momentum. The strong resistance level at $574 will become the next target for the bulls, followed by the breakthrough of the historical high of $791.
The weekly chart of SUI is simply stunning.
The weekly chart of SUI looks very enticing. The price has broken the downward trend line and is currently breaking through the key resistance level of $2.34. If the bulls can break the current resistance level, it may rapidly surge to $2.83.
Trading Philosophy - Simplicity
When I first started trading, I saw others talking about trading philosophy and investment philosophy, and I thought to myself, 'It’s just trading for profit; what does it have to do with philosophy?' Until later, after trading for a while, I slowly realized that trading is indeed related to philosophy and closely connected. It can be said that trading philosophy is the source that guides trading behavior. Only by thoroughly understanding trading philosophy can one manage their trading behavior well and lay the foundation for achieving significant success in trading.
“Trading must be a matter of simplicity. Do the simplest things, earn the most reliable money in the market, this is the deepest lesson the market has taught me.” This is a sentence I wrote in the previous article and is one of the most useful insights I have gained from trading philosophy.
What does the so-called simplicity prevail mean in trading? For example, one common piece of trading advice is, 'The more trades you make, the more mistakes you make; reduce trading frequency,' which is indeed following the principle of simplicity.
In my investment logic, I choose to hold mainstream cryptocurrencies with large positions over a long period, capturing large fluctuations at the weekly level, which is also based on this understanding, further implementing the results in action. Therefore, this seemingly ordinary choice is not due to my inaction, lack of boldness, or brilliance, but rather clarity.
After trading for so long, I have increasingly found that short-term predictions are very difficult; short-term trading is equivalent to high frequency. Even teacher Li Xiaolai has mentioned multiple times in his books that the results of shorter-term predictions are closer to flipping a coin. For retail investors, we do not need the probability of flipping a coin; we need relatively reliable choices that can help us make money. Thus, instead of anxiously monitoring how the market moves daily, worrying about principal retracement or missing out on opportunities, it is better to simply plan for the medium to long term and seek highly certain results.
I also do this when trading contracts; the number of contract trades in a single month should be within 15. The risk in the contract market is very high, and a little carelessness can lead to significant losses, so I dare not hold long positions. I generally capture four-hour market conditions and make a few trades each month. Moreover, my actions in opening and closing positions are also very decisive.
Once an entry opportunity is found, carefully assess it, act boldly, and there will be simple and executable discipline after entering. For instance, in situations where the position has not been profitable for a long time, if there is any market movement in the opposite direction, I will decisively exit, even if I later realize I missed a wave of the market. I know many friends hesitate during trading, missing opportunities and stop-loss chances, only to regret it later. If you find yourself often having such trading psychology, it is crucial to pay enough attention and deeply understand what 'simplicity prevails' means, reshape your mindset, and cultivate trading habits.
In the contract market, the priority is to survive first and then pursue profit. If you find it difficult to survive, how can you talk about making money?
The selection of target positions is similar; my choice is to keep it as simple as possible. Of course, this actually raises the question of putting eggs in a few baskets.
In this matter, we often have such considerations: on the one hand, we want to select several targets, fearing to miss the one with the biggest increase in a bull market; on the other hand, we want to diversify investment risks, fearing to step into a minefield. On the surface, this consideration seems reasonable.
Everyone can count how many targets are in their trading app's watchlist; it's estimated that there are dozens at least, and some friends may even have dozens of positions. This phenomenon is not only common among retail investors but also prevalent among big players.
As a result, after a round of market conditions, it is often found that the return on total funds is difficult to outperform the rise of most targets, and sometimes even fails to outperform the market index. This seems to not be the expected outcome.
Therefore, you will find that an excessive choice of targets can lead to the problem of overly dispersed funds.
Because it is difficult to guarantee that all selected targets will be among the top gainers, spreading funds will lead to a lack of concentration, resulting in insufficient profit from high-gain targets, thus affecting overall returns.
Moreover, when holding too many target positions, one must also consider the factors of market cycle rotation. Everyone should understand that cycle rotation is the hardest to grasp; if you are not a major player, it is very difficult to know when certain targets will be pumped and at what price level they will stop.
Look, having too many target positions is such a complicated matter, and the more complex the choice, the harder it is to predict the outcome.
As I said, in the face of choices, simplicity prevails. If you deeply understand this principle, selecting target positions will become very easy. I suggest generally holding no more than five positions at the same time.
Trading cryptocurrencies is akin to life; when you understand life, you also understand the crypto world. Simplicity leads to success, and knowing and acting as one can keep you agile and undefeated!
If you want to find opportunities to delve into trends and accurately seize trading moments, feel free to come to Su Ge's 'main business'!
Daily sharing, industry technology, market analysis, breaking down key points, help you thoroughly understand ETH's volatility logic!