I have slightly understood what a bear market is and what a bull market is.

Human nature is to seek benefits and avoid harm. In the face of profit, the instinct to seek benefits will drive the buying momentum of the group to have strong inertia, while in the face of fear, the instinct to avoid harm will also bring strong inertia to selling behavior;

So from a long-term perspective, the volatility logic of assets can never escape this rule, which is to move up and down along a reasonable price;

So for a bull market, when rational investors believe they have reached a reasonable price level, for example, when BTC is around 70,000, they will start to liquidate and leave, but the market's inertia is still there, so there will still be a price of 100,000;

As for a bear market, when rational investors think the price has reached the bottom, due to inertia, the price can continue to go down;

This is the market understood from the perspective of investors, but from the perspective of speculators, it is completely different;

The essence of speculation is to help prices return to reasonable levels and let the market reward us, so when prices become irrational, that is the time for speculators to enter;

When prices are significantly above reasonable levels, short selling helps prices return to rationality;

When prices are significantly below reasonable levels, going long helps prices return to rationality;

So for speculators, the market's irrationality is the source of profit;

But the problem arises, how to determine what the reasonable price level is?

Moving averages? Based on which period?

Data? At what level as the standard?

Macroeconomics? Based on which policies as the turning point?

Since it is about judging the difference between group rationality and irrationality, why not just focus on the group's emotions to make a judgment!

At the top of small-scale market trends or when new coins are listed, a large number of orders is a sign of entering an irrational price level;

At the bottom of large-scale market trends, when there is no discussion or a large number of losses and curses, it is a sign of entering an irrational price level;

During a decline, when people start shouting to buy the dip, it is a sign that the price has entered a reasonable range, and what follows is the irrational price level of a desperate abyss;

During an uptrend, when people start to liquidate and exit the circle, it is a sign that the price has initially entered a rational range, and what follows is also waiting for the final irrational price level of madness;