May 18 Midday Analysis

Early morning sharp drop of nearly 2,000 points, main force诱空洗盘, low positions are a good opportunity for longs

Bitcoin suddenly plunged nearly 2,000 points in the early morning, causing short-term panic sentiment to peak. Many retail investors were misled by the weak surface of the market and followed the trend to sell out in fear. But this decline is essentially a deliberate smash-down and washout by the main force, a typical bear trap, not a trend reversal. The goal is to shake out weak-handed chips during the sharp drop to clear obstacles for subsequent rallies.

From a technical perspective, the three consecutive daily bearish candles are a healthy pullback during an upward trend, not a sign of a formed bearish trend. Although the MACD bearish momentum appears to temporarily enlarge, it is actually a technical divergence caused by the short-term rapid decline. The support below is very strong, and selling pressure has not continued to increase volume. The bearish momentum is only short-term虚势, and the overall higher-level bullish pattern has not been broken.

Currently, focus closely on the 76,500 key strong support watershed. The limit retracement zone of this round of decline is near this level.

Trading Suggestions

If the pullback stabilizes above 76,500, you can directly follow the trend to go long, targeting 78,500-79,000, with the potential to continue the rebound and surge higher.