Recently, a new trader asked me, when the price of a certain coin is soaring all the way up, why they can't make money but instead lose?

After I asked carefully, I found that the problem lies in the understanding of the concept of ATH.

ATH stands for All Time High, meaning the highest price an asset has reached since it has been traded.
This ATH concept seems simple, but in actual trading, it is a common pitfall for many people.
I noticed that many traders tend to lose their rationality when the price hits a new high, and this is often when the risk is greatest.

Why is that?
When the price reaches its historical peak, the market has already digested most of the available supply.
At this point, if you still chase and buy at the high, what you face next is usually not continued rise, but a long-term correction period.
This correction can last for weeks or even months, and many inexperienced traders get caught during this process.

So what should you do during an ATH rally?
I’ve summarized a few practical methods myself.
First, observe the stages of the breakout.
Generally, there are three stages:
- Action stage (price breaks resistance, trading volume is abnormally high)
- Reaction stage (the upward momentum slows down, a pullback occurs)
- Resolution stage (deciding whether the breakout can sustain)
Only when the breakout is fully confirmed is it worth continuing to participate.

Second, use technical tools to assist judgment.
Fibonacci ratios (especially key levels like 23.6%, 38.2%, 50%, 61.8%) near ATH often serve as support and resistance.
I also frequently refer to moving averages; if the price is clearly below the MA line, it indicates a possible downtrend.

Finally, have a clear risk management plan.
When approaching the peak, many people's instinct tells them to hold or add to their position, but this is often the most dangerous time.
I recommend setting profit targets based on Fibonacci extensions, such as 1.618 or 2.000 levels.
And strictly set stop-losses, especially when the risk-reward ratio is unfavorable—it's better to miss out than to get caught.

Regarding the understanding of ATH, it’s actually about recognizing that it does not signal a continued rise, but rather a turning point that requires caution.
Some long-term investors may choose to hold all their positions, but this must be based on solid fundamental analysis.
Most traders tend to sell in parts, using Fibonacci tools to determine the proportion to exit.
Some aggressive traders may choose to clear all their positions when ATH coincides with Fibonacci extension levels, maximizing profits.

Honestly, trading near ATH tests your psychological resilience.
I’ve seen too many people make wrong decisions here due to greed or fear.
But if you can stay calm and follow technical analysis rules, you can actually profit from such market conditions.
If you're interested, you can check the historical charts of some assets on Gate and experience the market behavior before and after ATH yourself.