The underlying logic of the cryptocurrency world: trends and human nature games under 'extremes must reverse'
In the chaotic trading of the cryptocurrency world, 'extremes must reverse' is never a metaphysical concept, but a fundamental law that runs throughout - all extreme one-sided markets and extreme market sentiments will eventually return in the opposite direction. Behind this lies the dual logic of trend cycles and the game of human nature.
Currently, there are three clear signals that are sufficient to support judgments about the subsequent market: first, the market's expectation of 'interest rate cuts landing' has gradually been digested; in the past, interest rate cuts were more a tool for the main force to create momentum based on sentiment, rather than a simple market driver; second, the 'bottom era' of altcoins has completely passed, with most cryptocurrencies having experienced half a year or even two years of low-level consolidation, and the chip structure has long since departed from the bottom oscillation range; third, there are only three months left in the three-year cycle window for Bitcoin, and combined with the current market rhythm, it is highly likely that the cryptocurrency world will enter a crash-style adjustment from bull to bear before the end of the year.
Looking at the main logic of specific cryptocurrencies, taking Ethereum as an example, previously around the price level of 1400, it became meaningless for the main force to continue dumping - retail investors neither follow the trend to short nor are willing to rashly go long, most choose to watch and leave the market. If they continue to dump further at this point, not only would they fail to harvest chips, but they would also give 'diamond hands' and spot players an opportunity to pick up chips at low prices; conversely, if the main force chooses to pump, it can instead entice retail investors to chase high prices to enter the market, and then later complete the harvest through a pullback. This is also a core reason why many first-tier market cryptocurrencies have been able to achieve dozens or even hundreds of times increases recently - the essence of a bull market has never been a universal rise, but rather the use of retail investors' emotional trading, accurately hanging them at the highest point of the market.
Altcoins have another typical characteristic: pump and dump always occur outside market expectations. Behind this is the law of fund structure revolving around 'human nature' - when most people have not yet noticed a certain cryptocurrency, it is often a key stage for the main force to accumulate; when the market starts to hotly discuss a certain cryptocurrency and everyone feels it is an opportunity, it is precisely the moment when the main force is preparing to distribute, which is also the beginning of the market crash.
Ultimately, opportunities in the cryptocurrency world are always left for those who are prepared. The essence of 'extremes must reverse' is a repeated harvesting of human greed and fear, which is also why the current K-line charts can always find similar trajectories in past markets - because human nature has never changed, and the cycle of trends will not stop.#ETH创历史新高
