As you can see, I have been recharging your faith in recent times. I am bullish on the overall direction of the market. In fact, we have long left the bear market, but the bull market has not yet started. From the perspective of volatility, the bull market has actually arrived quietly (if you want to see it, I can write a special article to explain it in detail). After the bull market comes, let’s not talk about whether any coin will rise. In fact, everyone will be hesitant about specific operations. There will definitely be a big retracement after reaching the stage top, and it is more reliable to buy which currency first after the big retracement. Therefore, I will write a technical strategy today.

First of all, we need to know why the market has reached a certain peak. Is it because of the resistance level? Or is it due to other reasons? If you don’t know these internal things, you will not be able to understand them. Let me explain it to you in my own way. The peak of a certain peak is caused by too much short-term capital inflow, which leads to a gap in the subsequent period when no capital can flow in. During this gap, the profit-taking of profitable players and the lack of subsequent capital to take over the market caused the market to fall. After some people stopped losses, the market was smashed down by them, which caused a butterfly effect, causing more people to stop losses, forming a death spiral, and the peak of a certain peak was formed.

The method of determining the stage top is what I will focus on in this article. At the same time, this method can also be used to determine the stage bottom.

For example, from the first picture we can see that every time the open interest in the Bitcoin contract market approaches the recent historical high area, it will go through a wash-out. On the contrary, we can draw a conclusion that if the open interest falls back to near the low point area, it is considered that the wash-out is over, and the probability of being at a stage bottom is relatively high. When the open interest is higher than the recent level, the probability of being at a stage top is relatively high.

In the recent market, we can see that the contract market positions of many altcoins have increased significantly. During the decline in the past two days, the positions of many currencies have fallen back to the origin. Except for those coins whose prices have also fallen back to the origin, just the position falling back to the origin can be considered strong, and there is a high probability of setting a new high for the year. Here I give a demonstration chart. The price must be strong and cannot fall back to the origin while washing the market. The core idea is to wash the contract rather than the price.