Cyclicality: This market must be cyclical, and the most friendly thing for everyone is that the cyclicality of this market is very stable. Compared with the ten-year bull market in Myanmar A, the bull-bear cycle in the cryptocurrency market every three or four years will continue for a long time. This is the cycle. In a market with a stable cycle, making money is as easy as taking something out of a bag.
First: value the long-term investment benefits brought by patience and waiting.
Second: Investing is something that requires accumulated experience and luck. If we don’t have that much intelligence, we must work hard to survive a few more bull markets.
Live through several rounds of bull markets, firstly to encounter more life-changing opportunities and have more chips to participate; secondly, to better sense the market and make correct judgments.
First, determine the stage the market is in (emotional theory) to avoid being blind, and to wait for the appropriate stage for buying and selling ('dead silence' period for buying, 'crazy' period for selling). Using 'emotional theory' + 'specific market situation' as a major basis, with 'space + time' as criteria, fill positions before the bull market arrives, and gradually liquidate according to the selling principles of trend investing after the bull market turns.
Currently, the market clearly has not entered a 'crazy' phase. If position management and groundwork are well done, all that can be done now is to patiently wait for the comprehensive characteristics of the bull market peak signal:
1. On-chain indicators: MVRV is high (3~4+), NUPL enters the euphoria zone, unrealized profit ratio is extremely high;
2. Emotional indicators: Fear and greed index remains above 80 for a long time, with extensive media and public discussion;
3. Technical aspect: Price is far from long-term moving averages, weekly or monthly RSI is extremely overbought; price reaches a new high but volume fails to follow or shows divergence;
4. Overheating in derivatives: Leverage in the futures market skyrockets, long-short ratio is imbalanced, funding rates are high;
5. Mainstream capital trends: Institutions or whale addresses sell off significantly, exchange balances rise;
6. Macroeconomics and public opinion: Easing turns to tightening, significant positive news can no longer push up coin prices, while negative news can easily trigger violent fluctuations.
If at some point in the future, these signals converge or largely overlap, you should be wary of the risk of a market top and correction at any time. The real absolute top is often only confirmed in hindsight, but referring to the indicators above helps to take profits in time or reduce blind chasing of highs.
The crazy period is generally short. Once the above signals arrive, it may quickly enter the decline zone, but the decline will not be fast, generally a slow cut. Finally, it enters the dead silence zone. Before the 'dead silence' period arrives, we must practice what we preach. Never hesitate during the selling phase; if you cannot sell, you will lose a lot of profits and miss the second wave when the bear market returns due to a lack of good bottom-fishing funds.
This cycles repeatedly. As long as the setup is good, once the bull market starts, the account will enter a crazy profit mode. Each round of bull market sees Bitcoin rise at least 5-10 times from a low position; it's also normal for altcoins to increase by hundreds of times. Our goal is just to double the amount of Bitcoin once in a cycle, which is sufficient.