Understanding market cycles is crucial for navigating gains and losses.
Markets, like casinos, exploit human emotions for profit. After a decline (Accumulation), fear prevents buying. As prices rise (Uptrend), FOMO leads to buying at the peak.
Euphoria (Distribution) makes retail investors buy more, becoming exit liquidity for smarter entities. Finally, as prices drop (Decline), initial dips are bought, but sustained falls cause panic selling and losses. Recognizing this cycle can lead to consistent profitability.