In the crypto world, many people have illusions about candlesticks, but the reality is not so.

I once met a big shot at a brokerage who turned 200,000 into 10 million, and he had a piece of wise advice.

A big shot said: 'Candlesticks are a presentation of capital voting in advance, not a tool for fortune-telling; they interpret market sentiment.'

Take Ethereum as an example, looking at the 4-hour chart and combining it with the weekly situation, it is currently in a downtrend channel. Moreover, the lower Bollinger band has already opened up, and in this situation, any rebounds that occur are likely to be traps for the uninformed.

Don't just focus on candlestick patterns; on-chain data is more convincing. Whales have transferred out 1.2 million ETH in 30 days. This means that the hoarding party is starting to waver, and this tangible capital movement is much more reliable than MACD golden crosses.

When trading, never be foolish enough to stare at the 15-minute chart, as it will only lead you astray. Focus on the weekly level, understanding the resistance and support levels is enough. As for the price fluctuations in between, consider them as the market makers setting off fireworks, and don't pay too much attention.

When trading Ethereum, remember these 'three no principles'.

First, don't try to guess the bottom; the bottom cannot be calculated. It appears when retail investors are too scared to step in. Currently, the long-short ratio is 1.2:1; the real bottom will have to wait until this ratio drops below 0.5.

Second, do not stubbornly hold on; 'long-term holding' in a downtrend channel is a lie. Reduce your position by 20% when it rebounds to resistance. Wait until it drops to support before buying back your reduced position; actively lowering your cost is the best strategy.

Third, neither hold a full position nor be empty-handed; the current market drops 1% daily, like cutting flesh with a dull knife. If your position is too heavy, your mindset can easily collapse, so short with a light position, leaving 30% cash for black swan events.

In the crypto circle, both 'blindly trusting candlesticks' and 'completely not trusting candlesticks' are misconceptions. Understanding candlesticks can help you know whether the market is excited or panicking, allowing you to grasp the current situation.

But don't let candlesticks lead you around by the nose; avoid becoming a puppet of technical analysis. True experts determine direction using weekly charts and find signals with daily charts; for other time frames, relax when necessary. After all, even if you strain your eyes and stubbornly focus on candlesticks, the market makers won’t give you an extra U.

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