Recently, I’ve been chatting with a few traders and found that many people don’t have a deep enough understanding of what the concept of ATH is. I just want to organize my thoughts and share some practical experience.

ATH actually stands for All Time High, simply put, it’s the highest price an asset has reached since it has been traded. Many people think it’s just a simple number, but in reality, it represents a turning point in market sentiment. When cryptocurrencies hit a new all-time high, that feeling can indeed make people get carried away.

I’ve personally fallen into the trap of blindly chasing highs near ATH. At that time, I didn’t think much, just watched the price keep rising and bought along. As a result, after reaching the peak, the price started to correct, and I was trapped for several months. Later, I realized that what ATH really is isn’t just a number; it’s more like a psychological barrier in the market.

What truly changed my trading approach was learning to use technical analysis tools. Fibonacci retracements and moving averages are two things I now always use when approaching ATH. The Fibonacci ratios (23.6%, 38.2%, 50%, 61.8%) can indeed help me find support and resistance levels. Moving averages help me judge whether the trend is upward or downward, which is very helpful for decision-making.

When approaching ATH, many people think the resistance level has disappeared, but that’s not the case. I found that breaking through a resistance happens in three clear stages. First is the action stage, where the price breaks through resistance with significantly increased volume. Then is the reaction stage, where buying momentum begins to weaken, possibly leading to a pullback. Finally is the resolution stage, where the market decides whether this rally will truly continue.

My current trading logic is like this: first, look at the price structure and confirm the bottom pattern. Then, use Fibonacci from the low point to the breakout point to find new resistance levels, especially at levels like 1.270 and 1.618. At the same time, set profit targets and stop-loss points. This way, even traders who aren’t so clear on what ATH is can have a relatively rational framework.

When I actually hold an asset that hits ATH, decision-making becomes more difficult. My usual approach is to sell in parts. First, sell some to lock in profits, and then see how things go. If Fibonacci extension levels coincide with the ATH price, I might consider liquidating everything, because that usually indicates the upward momentum might be waning.

But if I am truly long-term bullish on a project, I will also choose to hold on. The premise is that it’s based on thorough analysis, not just feelings. That’s why understanding what ATH really is, is very important. It’s not just a trading signal; it’s a tool to help you gauge market sentiment.

Finally, I want to say that you must be cautious when adding positions. Only when the risk-reward ratio is favorable and the price is supported by moving averages will I consider increasing my position. Otherwise, it’s just gambling.

Do you have experience trading near ATH? Feel free to share your stories and thoughts.