After the plunge, what do you think?
I am very vigilant and worried about the high and volatile market in the digital currency market, especially when the investment public is almost crazy, I will become more and more uneasy. This feeling of being out of control became intense last week. This fidgeting nervousness caused me to liquidate some of my long positions and protect the rest while establishing some short positions.
In fact, before last week, I would try to establish multiple short positions at the high points of some bands, but in the end it was a situation of no profit/no loss/small profit. The rapid decline after the 3rd knocked out my remaining long positions At the same time, the floating profit of the short position is rapidly expanding, and it is currently in a relatively safe position.
This short position is actually strategic in nature. As long as the market does not reverse and destroy my protective stop loss, then I will always hold it, because the entry position is good enough, no matter how the price changes, I will not lose money. The big deal is Just earn less.
The real question is, why is this judgment being made? Is it really just by feeling? Haven't I been emphasizing, "Doesn't trading need emotions, but planning?"
This "feel" comes from the following aspects:
The Fomo sentiment of Defi projects is too serious. Basically, all assets related to Defi just skyrocketed. New leeks and even mainstream currencies were not fully understood, so they were brought into the Defi market. The effect of making money can be seen, and the overwhelming publicity of many mainstream media also stimulate Breeding the "myth of getting rich quickly", after all, who doesn't want to buy a lottery ticket to win millions and get rid of the poor and lower-middle peasants? But, "It's always been like this, right?"
The extremely low threshold for issuing coins, the black hole of ignorant information, and the examples of getting rich on the screen, the more I see, the more cautious I become. When a profitable matter is made public, the opaque information gap is smoothed out, and the channel Resources are made public, hot money is pouring in, cooling down is a must.
Consolidation shipments at high levels. On the technical side, BTC has basically risen without a callback since 312, which fully meets the expectations of the investing public. However, historical experience tells us that every period of long bulls will inevitably experience several surges and falls. It is necessary to obtain cheaper bargaining chips through this behavior, and then drive up shipments to maximize profits.
BTC has maintained a high and volatile trend for nearly two months at 10,000-12,000 points, which is just in line with the characteristics of traditional technical washing, and this confirmed point, after the price of 10,600 was broken by heavy volume, the short-term trend reversed. It is also the reason why I said 10600 as the final defensive position.
There are a few things I would like to say about the market outlook:
At present, the market is dominated by short sellers, and the operations following the trend should be mainly short selling, and hedging operations should be carried out for a large number of spot positions
2 Whether this wave of shorts can get out of 312 is an unpredictable thing. Don’t worry about this matter. It’s better to see if the recent 8500 can hold up. If it can, it can bring a wave of rebound
The bull market is still there, but the cycle is far-sighted
Don’t not hedge or go long because of 3. Even if a positive line goes up, you still have a chance to get in the car, but if you predict the bottom, then there is a high probability that you will die before dawn
Finally, for the digital currency market, I still hope that all kinds of assets can flourish and go out at their own pace, but no matter how the price rises and falls, it will eventually return to the essential principles of trading: set rules, make plans, and execute them. Have an idea, plan this idea, and work hard to realize it through rules such as position, entry and exit, so that it can last for a long time.
