After a sustained decline, BTC found support near $80,000 and ETH near $2,400.
The question on everyone’s mind right now is: Is this a good time to buy the dip?
Trend Alpha’s take:
You can consider building a position in stages, but we don’t recommend committing heavily all at once. For now, it’s better to actively manage your cost basis than to bet that the market has already bottomed.
The reason is simple: prices have pulled back to levels worth watching, but support holding doesn’t mean the trend has reversed. We don’t need to guess the exact bottom. Instead, we should gradually build positions at favorable prices while keeping risk under control.
I. Core Thesis: Price Entering a Watch Zone Does Not Mean a Bottom Is Confirmed
BTC at $80,000 and ETH at $2,400 are important levels to watch at present.
The fact that price has found support here indicates that buyers are stepping in. But to judge whether a bottom is in, we can’t just look at whether the decline has temporarily stopped. We also need to look for three signs:
Is support holding? When price retests, can it stay above the key zone?
Is selling pressure easing? Is downward momentum fading, and is the rebound supported by trading volume?
Is market structure improving? Are lows gradually moving higher, and can price reclaim key levels it previously lost?
If these signals don’t appear, we can’t define a rebound as a trend reversal.
But that doesn’t mean we have to stay entirely in cash and wait.
For investors with a medium- to long-term horizon, key support zones can serve as a starting point for assessing entries in stages, provided they can tolerate the risk of further price declines.
II. Core Thesis: The Key to Building a Position Is Cost Basis, Not Guessing the Bottom
We have always emphasized one principle:
Long-term returns depend not only on getting the direction right, but also on the price at which we acquire our holdings.
If we wait for the trend to be fully confirmed before buying, we may miss some upside. But if we keep trying to catch the bottom during a decline, our positions may leave us with no flexibility as the trend deteriorates.
So instead of trying to buy at the absolute low in one go, we divide position-building into several stages.
Trend Alpha Position-Building Plan
The following is an example of how to allocate the funds earmarked for this plan. It does not confirm that current support will hold.
Stage
Trigger Conditions
Planned Allocation
First tranche
Signs of stabilization near key support
20%
Second tranche
Price retests and holds support, while selling pressure eases further
30%
Third tranche
Reclaim key resistance and see price structure strengthen
30%
Funds held in reserve
Responding to a loss of support or a better entry opportunity
20%
There is an important distinction here:
The first tranche is a test position, the second requires evidence of support, and the third requires an improving trend.
We don’t buy more simply because the price falls further. We consider increasing our risk exposure only as the evidence grows stronger.
If support fails, we should pause the planned additions and reassess the market instead of mechanically continuing to buy according to a set allocation.
III. Core Thesis: If Support Fails, We Must Acknowledge That Our Assessment Needs to Change
We can’t just plan how to make money if prices rise; we also need to think in advance about what to do if our assessment is wrong.
BTC:
Around $80,000: Watch whether support holds.
A decisive break below support with no recovery: Pause additions and reassess downside risk.
Recovery of key resistance and formation of a higher low: Reassess whether conditions favor increasing the position.
ETH:
Around $2,400: Watch the strength of buying interest.
Continued weakness after a break below support: Don’t automatically add to the position just because the price is lower.
Price regains and holds a key level, and market structure improves: Then consider further allocations.
The next support level needs to be reassessed against real-time prices and the latest market structure. A preset price should not be treated as an absolute safety net.
For those who already hold large positions, the strategy should not be exactly the same as for those with no positions. Existing holdings require prioritizing overall risk and capacity to absorb losses, rather than simply applying the allocation ratios for new capital.
IV. What We’re Really Waiting For Is an Opportunity in the Next Cycle
Trend Alpha is not about predicting whether the market will rise or fall tomorrow, but about assessing which phase of the cycle the market is in.
If this is only a deep correction within a bull market, gradually accumulating at manageable risk could lead to a better long-term cost basis.
If the market has already entered a deeper downtrend, committing too much too early will come at the cost of time and capital.
So we need to retain both of these capabilities:
Be willing to start building a position when the price is attractive.
If the trend deteriorates further, we can stop adding to our positions and protect our capital.
This matters more than being relentlessly bullish or relentlessly bearish.
Trend Alpha’s Final Assessment
Current strategy: A small initial position and staged entries are reasonable; we don’t recommend going all-in to catch the bottom.
BTC at $80,000 and ETH at $2,400 can serve as price zones to watch and assess potential entries, but these levels alone cannot confirm that the market has bottomed.
Next, we’ll focus on whether support is holding, whether selling pressure is easing, and whether the price structure is strengthening.
If the evidence improves, gradually increase our allocation. If support fails, pause additions and reassess.
The trend not yet confirming a reversal doesn’t mean we can’t establish a position at all. But any positioning must be based on keeping the position size under control and ensuring the risk is manageable.
We don’t need to buy at the absolute low, nor do we need to prove ourselves right with every dip.
What we need is to build a position at a reasonable cost, improve our odds once the trend is confirmed, and preserve capital if our assessment is wrong.
Trend Alpha | Above the trend. Cost determines the potential, the trend determines the direction, and risk management determines how far we can go.