Have you ever properly considered how to approach the ATH (All Time High) in actual trading? Recently, I’ve received various questions about this, and many investors tend to make mistakes at the point when the price reaches a new high, resulting in losses.

First, the basics. ATH refers to the highest price an asset has reached from the past up to now. In the world of cryptocurrencies, it’s a particularly important indicator. Reaching this level signals that the market is heading toward a new peak, but at the same time, the risks also increase rapidly.

During an ATH, many traders become emotionally driven. They tend to rely more on intuition than technical analysis, leading to irrational decisions. This pattern often results in significant losses.

Therefore, a practical approach is necessary. Use Fibonacci ratios (23.6%, 38.2%, 50%, 61.8%, 78.6%) to identify resistance and support levels. Checking where moving averages are located helps assess the sustainability of the price trend. In the cryptocurrency market, just before reaching ATH, the market has almost absorbed supply, and subsequent correction periods can last from several weeks to several months.

The process of a price breakout occurs in three stages. The first stage, “Action,” involves breaking above resistance with trading volume exceeding the average. The second stage, “Reaction,” sees buying pressure weaken, and the price undergoes a correction. The third stage, “Resolution,” involves a significant change in buying and selling momentum, confirming whether the breakout is valid.

When approaching ATH, it’s important to observe candlestick patterns just below the breakout point, such as rounded bottoms or rectangular bottoms. Also, using Fibonacci retracements from the lowest point to the breakout point helps identify the next resistance levels at 1.270, 1.618, 2.000, 2.618, etc.

Protecting profits is equally important. Set a minimum profit level and determine a take-profit point during price reversals. Increasing your position should only be considered if the risk-reward ratio is favorable and the price remains supported by moving averages.

When holding an ATH position, investors have three options. Long-term investors might choose to hold all their assets. However, it’s essential to calmly analyze whether the current ATH is temporary or fundamental before making a decision. Most investors opt to sell part of their holdings. In doing so, they often use Fibonacci extensions to guide their selling decisions. Finally, if the Fibonacci extension aligns with the ATH price, it could indicate the end of the upward trend, making full liquidation a reasonable choice.

Currently, Bitcoin’s ATH is around $126,080. By combining these technical methods during an ATH in the cryptocurrency market, you can maximize profits while managing risks. How do you handle ATH situations? I’d love to hear your experiences and thoughts.