$TREE Why is the market mainly cautious when a new coin is just launched???
First, we need to understand that when a new coin is launched, there is selling pressure from【new subscriptions and profit-taking】. The market does not have excess funds to maintain the market value of the coin price, including recently launched new coins without backing from large institutions; a market cap of 100 million is basically considered overvalued.
Private placements and early investors have long taken profits and exited, and the project team has cashed out, leading to a natural price decline. Compared to previous pumps【where they cashed out directly】, this has caused strong panic selling in the market.
Of course, we don’t short every new coin that is launched; the project team is not foolish. When there are many short sellers, they will definitely first clean out the contract players before unloading their coins. The most prudent approach is still to remain cautious; when a clear downtrend is established, that’s our opportunity to enter short positions. 😁😁
