BTC is currently quoted at around 30500. Yesterday, BTC experienced a shock and rose to 30800, and then accelerated its decline. This led many people to misunderstand it as a short signal and engage in large-scale short selling.
However, extending from the hourly chart to the longer timeline, although the bearish trend is obvious on the surface, BTC turned down after hitting 31395 last Tuesday. Many people did not hesitate to regard it as a bearish trend.
But they seem to have overlooked one thing: Looking back at last week's candlestick chart, we can see that BTC has repeatedly hit 31,000 and then went down, but it has never broken through the support level near 30,000. Recently, I have been reminding everyone that both long and short positions should not be too extreme.
In fact, the trend of BTC has been in a large range of 30,000-31,500. Under this market situation, it is not wrong to go short at high levels or go long at low levels.
Based on my personal opinion, the overall trend is still bullish, so I will choose to add positions when the market dips, because I think the risk of shorting is higher. My trading style is mainly stable, and I will only try to short with a small position. For many people, the reason for being bearish is that the market will pull back. According to convention, it is normal to pull back after a surge. But the current market is not a real retail market. There are few retail investors and many main funds. We cannot determine the trend based on past conventions.
BTC still has strong buying support below 30000. At present, I think the conditions for shorting are not mature enough. Only a pullback is valid. There is not much reason to short in other cases.
Since BTC first hit a high of around 31,500 and then fell back, I have been observing it and finally concluded that the main force is in a round of large-scale accumulation, during which it will continue to wash the market, accumulate funds and increase the turnover rate. The two main aspects of shipments at present are the recent large-scale shipments by miners and the collapse of the NFT market, which has caused many NFT project parties to urgently need financial assistance and cash out.
Of course, for me personally, the key point to trigger a short position is around 29800. If the downward speed is slow and stable, and gradually breaks through 29800, I may choose to wait and see in the short term instead of blindly chasing the short position. However, if it falls rapidly or quickly reaches around 29800, I will only choose to cover my position.
If you look closely at the 4-hour chart and extend the time axis, you will find that the rally since June 24 has failed to break through the previous high and then fell back. This gives people a feeling of an impending correction. I think this is a form that the main capital shows to retail investors. If the trend is judged only by line charts and surface phenomena, then everyone can make money easily. Therefore, understanding the thinking mode of the main capital is crucial to judging the market.
Trend direction: The overall trend is still bullish and will continue to fluctuate widely in the short term. The main funds need to conduct sideways trading to clean up and absorb funds during this period. It may not easily rise in the short term, but it will not let the market fall too hard.
Trading strategy: In the short-term volatile market, both long and short positions are feasible. You can short at high points and buy at low points, but it should be noted that the risk of short at high points is slightly higher, and you should set up a good stop profit and stop loss. It is safer and more stable to buy at low points. There are frequent pin-spiking behaviors in the recent market. It is recommended to open a small position at a small scale to leave opportunities for pin-spiking and covering positions.
Spot: The original plan was to wait for the market to stabilize before arranging several spot transactions. At present, the main funds are still concentrated on BTC or ETH, while other altcoins are sucked more by the main force. However, you can lock in a few targets to prepare for positions. In terms of L2, ARB and MATIC are both good choices, one has good growth potential and the other is relatively stable. The wallet field deserves special attention in the near future. The chain game project has recently shown signs of starting, and the ssv of the LDS sector can be used as a long-term layout. You can just take a light position below 15 and wait and see at the end of the year. If you can't hold it, don't choose the long-term. You need to choose carefully and keep it stable.
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