📉 Today's market drop: How do we read it as beginners?
Today, the cryptocurrency market witnessed a noticeable drop in most currencies, which is a natural and recurring phenomenon in financial markets. Beginners often feel fear when they see prices dropping, but in reality, the drop is not always a negative thing; rather, it is an opportunity to understand support and resistance areas.
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🔹 What do support and resistance mean?
Support: It is a price level expected to stop the drop, as buyers enter heavily at that level. For example: If the price of Bitcoin is $60,000 and drops to $58,000 and bounces back from it several times, then $58,000 is considered support.
Resistance: It is the opposite, a level that prevents the price from rising further, as sellers enter heavily. For example, if the price tries to rise above $62,000 several times and fails, then we have resistance here.
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🔹 How do we read today's drop?
1. We monitor the nearby supports: We see where the price might find the first bounce area.
2. We follow the trading volume: If the drop was accompanied by high volume, it indicates strong selling pressure.
3. We connect with fundamental analysis: news, economic data, or liquidations in futures contracts may be the reason for the drop.
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🔹 Advice for beginners
Do not buy during the drop directly without identifying a clear support level.
Use the horizontal line tool on the chart to identify supports and resistances yourself.
Remember: If support is broken, it turns into resistance, and vice versa.
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✅ Summary: Today's market drop is merely a reminder that prices move between support and resistance areas, and the smart trader learns to read these levels instead of fearing every movement.
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