**How do you know that a narrative will end?**
Previously it was explained that narratives only last 2-4 months and after that there is a possibility that the assets of a particular narrative will no longer increase. Then the question inevitably arises, how do you know when a certain narrative will end?
#1It's been talked about by many people
One of the top signals that can be predicted is when a narrative has been talked about by "almost everyone". When a narrative is circulating on social media platforms or has entered the news, the sign is that the narrative is about to end. Understand that the greatest profits occur when things are still quiet, not when everyone is already on board.
#2Prices have not increased significantly
Signs that a story is coming to an end are that prices have started to experience a decline. For example, last week it rose 30% but this week it only rose 5%, this shows "saturation" where market players no longer have the energy to keep pushing prices up.
#3Volume starts to decrease
Volume shows the size of trading transactions. The reduced volume shows that "interest" in the sector is starting to wane. It could be that the smart money is "starting to leave" certain sectors and look at other sectors to invest in. Here we must look carefully at the potential for sector or narrative shifts to ensure the potential for excess profits.
#4Bigger time frame chart experiences Change of Character (ChoCh)
One sign that the potential narrative will end is that the chart in a large time frame experiences a change in trend from bullish to bearish. ChoCh's potential can be seen from the penetrated market structure, trendline, or trading patterns such as ehad and shoulder or rising wedge.
Hope it is useful!