The secrets that the dealer won't tell you: Recently, the market has fallen sharply. A friend of mine invested 500,000, and now he only has a little over 100,000 left, with a floating loss of over 70%. Coupled with many negative news, many people have started to panic. How far will it drop, and will it really go to zero? This article will explain in detail the basic logic of how dealers operate, and after reading this, you'll understand where it will drop to this time. The insider secrets that dealers won't tell you: First, you need to understand one principle: If a coin doesn’t have a dealer, it definitely won't rise, or it won't perform well. So, every coin that performs well has a dealer. Dealers are also human, and they need to make money. The most basic operation method of a dealer is to sell high and buy low. Therefore, what we need to do is follow the dealer to sell high and buy low, so you need to analyze where the peak is and where the bottom is. This article will systematically share the trends in the cryptocurrency market with you. Through this sharing, you will clearly know the dealer's operating intentions. After reading this article, you will be more skilled than most people in the cryptocurrency market. 1. Trading cryptocurrency mainly studies mainstream currencies. First, I want to clarify that what I share next is what dealers least want retail investors to know, so you must keep it confidential and not spread it around. We mainly trade mainstream coins for short-term trading, not altcoins, for several simple reasons: 1. Large market capitalization 2. High trading volume 3. Price fluctuations within a certain range 4. Not immediately crashing. However, air coins and altcoins are different; they have low trading volumes and can easily rise dozens of times in one day and then fall dozens of times within the same day, and once they fall, they don’t bounce back. Therefore, we focus on the top 20 mainstream coins by trading volume, such as BTC, ETH, ETC, EOS, ADA, TRX, XRP, DASH, etc. 2. Mainstream coins will experience 1-3 major corrections each year. Let’s look at the chart below; this is the price trend of Bitcoin over the past six months; the other coins are actually similar, so I’ll take Bitcoin as an example. You will see that there will definitely be 1-3 major corrections in a year, indicated by the red arrows, where there is a peak and then a drop to a low point; this is the major correction of the year. Within a major correction, there will also be 2-3 small fluctuations, indicated by the yellow arrows. The principle is simple: if the price keeps rising, the dealer cannot make more money. Therefore, the dealer will definitely offload at high prices. After the dealer sells at high prices, they will suppress the coin price to the lowest point and then use the least amount of funds to buy back at the lowest point, thus maximizing profits. Do you understand? Usually, each major correction will drop 70%-90%. For Bitcoin, the peak was over 20,000 USD, dropping to 6,000 USD, a total correction of 70%. XRP corrected over 80%. So, when you notice a major drop in the future, know that this is a normal phenomenon. 3. Each major correction will have 2-3 small fluctuations. Continuing from the above chart, by July 2018, you will find that there are two small fluctuations. You may ask, why do small fluctuations occur instead of directly rising to the original peak? The reason is simple: when dealers offload at high prices, many retail investors get trapped at high levels. If the dealer rises back to the original high, many retail investors can break even, which means the dealer must rise to a higher level than before to make a profit; otherwise, the profit is not high. Therefore, through small fluctuations, the dealer forces the trapped retail investors to sell at a loss, reducing the chips at high levels, so that during the next rise, the dealer's profits can be maximized. To summarize, there will be 1-3 major corrections each year, and each major correction will have 2-3 small fluctuations. Do you understand the principles behind these? All of these are normal phenomena, so don’t panic and shout when the market drops; these are normal occurrences. 4. Each small fluctuation will have N profit opportunities. Below, I analyze Bitcoin using a 1-hour candlestick chart. You will find that no coin will rise or fall straight; it will always move in a fluctuating manner, which creates many opportunities for profit. Please see the chart below. This is the recent market trend: (1-hour candlestick chart). Suppose you can enter at the buy points indicated in the chart and sell at the sell points, then your profits will be substantial. Therefore, our short-term trading of coins is to profit from the fluctuating market within small segments, whether in a bull market or a bear market, there are many opportunities. What I need to do is seize those opportunities. Even if your timing for buying low and selling high isn't perfect, if you strictly follow technical operations, the profits will still be quite considerable. 5. Price fluctuations are all normal phenomena. If you notice a significant rise or fall in the future, and those around you are panicking, you should know that these are all normal occurrences, and there’s no need to make a big fuss. Now, let me teach you a trick: How to judge where the peak is and where the bottom is? It’s simple to judge where a major market trend will rise or fall: use the previous peak and bottom as standards. Usually, the amplitude of small fluctuations will not exceed the previous peak, and the drop will not break below the previous trough. As shown in the illustration: Have you learned it? Let’s summarize: there will be 1-3 major corrections each year, usually correcting 70%-90%. Each major correction will have 2-3 small fluctuations, with each correction being 40%-60%. Therefore, at high points, everyone is eager to buy, while at low points, everyone is fearful. So you need to go against the grain, borrowing a quote from Guo Guangchang: "Investment is often about going against human nature. When everyone is very nervous, you can be a bit braver; when everyone is eager to buy, you need to be more cautious." Trading coins is the same.
