I learned something that really changed my trading. Crypto is a trending market — and once a trend starts, it usually stays in that direction. That’s the most important thing to understand. If you miss that, you’ll keep losing money.



Let me start with the uptrend. This is what everyone hopes for. When the market is bullish, you always see the same pattern: the price makes higher highs and higher lows. That’s your confirmation that the trend is in the right direction. I always look at the daily or weekly chart — the larger timeframes show you the real movement. What happens on smaller charts is just noise in the end.

The most important thing: if the price doesn’t fall below the previous higher low, the bullish trend is still intact. Period. As long as that’s the case, stay optimistic and look for entry points.

Where do you buy in? Nowhere goes only upward. There are always setbacks. I’ve seen the chart look like it’s consolidating, but when you look at smaller timeframes, you notice the price has fallen 32 percent. That’s normal. The strategy: wait until the price drops into the key zone — that is, to the previous higher low — and take your position there. The goal is then new highs.

Now to the other extreme — the downtrend. It’s the same game, just reversed. Lower highs and lower lows tell you that it’s heading down. If you want to short here, use the same method: wait for a bounce into the lower zone of the higher timeframe and then go short. Target: new lows.

But most people lose money here: during a trend reversal. No trend lasts forever. And that’s where the drama happens. People who are pessimistic can’t accept that it’s turning bullish. They keep shorting. Or they were optimistic and can’t let go when the trend reverses. They keep buying.

How do you recognize a trend reversal? Very simply — use the same logic. If the uptrend breaks and the price falls below the previous higher low, that’s your signal. Then you switch your perspective from bullish to bearish and wait for new confirmation. Some take profits at that point, others go directly short. That’s a matter of preference.

Conversely: if the downtrend breaks and the price moves above the lower highs, the trend shifts back to bullish. That’s your sign to change sides.

That’s really all there is. Be bullish when the trend is bullish. Be bearish when it’s bearish. And if it changes, accept it and switch sides. That’s the only way to survive long-term and succeed. Anything else is just self-deception.
View Original
This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.
  • Reward
  • Comment
  • Repost
  • Share
Comment
Add a comment
Add a comment
No comments
  • Pin