After a bull market has been underway for some time, when Bitcoin (BTC) shows significant divergence at a high level and altcoins have already accumulated a certain increase, the operational strategy at this time needs to rely on the trend of Bitcoin to determine the actions regarding altcoins.
1. Chase:
When BTC is in a sideways consolidation or is pulling up from a low to a resistance level, and there is a clear profit effect in the altcoin market, even if the price of altcoins is already high, there is still room for further increases. In a bull market, lows keep rising, and highs keep reaching new records, so it is not advisable to rush to sell even at high levels.
2. Hedging:
When BTC approaches and tests a resistance level, it is necessary to pay special attention to the potential large drop after a failed breakout. At this time, one should promptly cut losses on altcoins, even if these altcoins have not shown significant gains. If timely action is not taken, once BTC pulls back, altcoins will be significantly impacted and may face a decline of 30%.
3. Staged Operations:
Market trends often progress in stages. When Bitcoin is nearing a resistance level, one can choose to cut losses, converting part of the position into Bitcoin or holding in cash. Trends in a bull market exhibit a spiral rise and are not achieved overnight. If one misses some independent trends of certain altcoins, there's no need to worry, as there will always be other altcoins to choose from.
4. Altcoin Position Recovery:
(1) When Bitcoin fails to break through and stabilizes near a support level, one can add to their altcoin positions, seizing the opportunity for a rebound from an oversold condition. The larger the drop, the greater the rebound will be.
(2) When Bitcoin breaks through a resistance level, one can also increase their altcoin positions, as the potential price increase for altcoins after a breakout is usually larger.