Let me explain the current state of the market in the simplest way possible, what’s going on, what you can expect, and how to manage it.
First, look at the attached screenshots and observe what you see.
Price was holding a support level for quite some time, but now it has broken below it.
Whenever price breaks an important level, you expect continuation in that direction. Since we're breaking support here, let's focus on the downside.
As long as price holds below these broken levels, bears have a reason to expect further downside. If you're bullish, you don't really have a reason to be bullish until price reclaims those levels.
So, how do you manage this if you're bullish?
You have two options.
1. Wait for discounts
If price drops further, look for important higher-timeframe levels where you can consider entering your positions.
2. Wait for a reclaim
This is my favorite scenario. If price reclaims the broken zones, the move below the lows could turn into a fakeout, trapping bears and sellers who entered on the breakdown.
When price breaks the lows, bears have a reason to short, so more sellers enter the market. But if price reclaims those same levels, those sellers can get trapped, giving bulls a reason to step in and potentially push price higher.
So, whenever price breaks an important zone, you either expect downside continuation or, if you're bullish, wait for deep discounts at higher timeframe levels or a reclaim of the broken zone.
This doesn't apply to every altcoin. It only applies to coins that have broken their important zones. Every coin has a different chart and different price action.
I've attached a few examples along with this detailed explanation to help you understand how to look at the market and what to watch for.
Apply the same approach to the coins you're holding or watching and see what makes sense for each one. Don't assume every coin will follow the same move.
First, look at the attached screenshots and observe what you see.
Price was holding a support level for quite some time, but now it has broken below it.
Whenever price breaks an important level, you expect continuation in that direction. Since we're breaking support here, let's focus on the downside.
As long as price holds below these broken levels, bears have a reason to expect further downside. If you're bullish, you don't really have a reason to be bullish until price reclaims those levels.
So, how do you manage this if you're bullish?
You have two options.
1. Wait for discounts
If price drops further, look for important higher-timeframe levels where you can consider entering your positions.
2. Wait for a reclaim
This is my favorite scenario. If price reclaims the broken zones, the move below the lows could turn into a fakeout, trapping bears and sellers who entered on the breakdown.
When price breaks the lows, bears have a reason to short, so more sellers enter the market. But if price reclaims those same levels, those sellers can get trapped, giving bulls a reason to step in and potentially push price higher.
So, whenever price breaks an important zone, you either expect downside continuation or, if you're bullish, wait for deep discounts at higher timeframe levels or a reclaim of the broken zone.
This doesn't apply to every altcoin. It only applies to coins that have broken their important zones. Every coin has a different chart and different price action.
I've attached a few examples along with this detailed explanation to help you understand how to look at the market and what to watch for.
Apply the same approach to the coins you're holding or watching and see what makes sense for each one. Don't assume every coin will follow the same move.
