To know the right step to take in such corrections, we have to look at some indicators to clarify what is really happening. Is it the end of the bull market, so we exit the market with the profits we have made? Or are we in a healthy routine correction to prepare for a stronger rise, so we stay so as not to lose our entry points?
First, let us know that the biggest mistake that most people make is exactly what is happening now. When the market declines and sees red candles, you find that everyone is talking about exiting and stopping losses, and pictures of losses and liquidation in futures contracts spread, and pessimism is extinguished. When you see the rise and green candles, you find that everyone is asking about entering, and pictures and articles of enthusiasm and going to the moon and other things spread, and optimism and greed are extinguished as if the market will rise forever.
We have to learn that the buy button on the screen is green but think about pressing it when the market is red, and that the sell button on the screen is red but think about pressing it when the market is green. Write these words on a piece of paper and stick it on your computer screen. You should never forget these words.
Now we have to think about the step and say: Is this the beginning of the decline, so we sell so that it does not fall further? Or is it a short correction after which the rise will resume, so we buy and say thank you to the market, it gave us another chance to enter and consolidate?
To determine this, we must know the bear market indicators, which are:
First: The acquisition reached the bottom at 40% levels, as shown in the image below.
Second: The alternative currency index tells us that we are in the 25 zone (the index is at the bottom).
Let us clarify the indicators in turn: Bitcoin’s acquisition reached a resistance area at 60%, tried to break it, reached 63%, failed, and fell to support levels at 55%, and now it is testing it. Now we are faced with two scenarios: the first is that the acquisition rebounds and continues its rise to the 60% resistance again, and we then monitor whether it will be able to break it or not, or we see a failure in support at the 55% areas, and both of them mean that the alternative currency season is still ongoing and there can be no way a bear market coming, because Bitcoin’s acquisition is the most important point for the market maker and the engine of smart money, and it is the point at which the wealth distribution stage begins (I explained it in several articles that you can read), and the market cannot go to the bear market without passing through it.
The other indicator is the Altcoin season, which is the alternative digital currency indicator that tells us that the return of the 50 strongest currencies over the past 90 days is greater than the return of Bitcoin. This means that Bitcoin has reached a stage where the benefit of investing in it is less than investing in the 50 strongest digital currencies. This means that smart money is heading towards alternative digital currencies because the return on investing in them will be greater than the return on investing in Bitcoin, just as small capital owners do by investing in alternative currencies because they can get a number of times greater than what Bitcoin can double.
In this reading, we also look at the levels reached by the liquidity of alternative digital currencies (with Ethereum), which is called TOTAL3. (Image below)
We see that the volume of liquidity has reached a violent and strong resistance area, which is the highest peak it reached in the Bull Run in 2021, which it was unable to break.
Here we see the total liquidity of digital currencies including Bitcoin, called TOTAL. (Image below).
When we see that the liquidity of all digital currencies has broken the 2021 peak, this means that the liquidity of digital currencies, with the exception of Bitcoin, will also break the 2021 peak when the Bitcoin acquisition decreases, which reached an important support point (55%), as we saw in the first indicator above.
After reviewing all the indicators, we see that we have reached a stage of certainty that the season of alternative digital currencies is still ongoing and that this decline is only corrective and a matter of time until it resumes its rise according to all technical indicators.
Now the big question is, how long and where will this correction last??
We mentioned at the beginning when explaining the Bitcoin acquisition indicator that we are facing two scenarios and no third, which are breaking the 55% support and continuing the decline or rebound and breaking the 60% peak. When the support is broken, liquidity will move to alternative currencies so that the TOTAL2 indicator will continue its rise and break its peak, similar to the TOTAL indicator, which means the rise of alternative currencies and the resumption of their rise, or the rebound and breaking or retesting the resistance, which means the continuation of Bitcoin’s rise to new areas, perhaps 120 thousand for example, and the decline or stability of alternative currencies.
This is what we are waiting to confirm through the upcoming indicators, which we follow day by day.
Let us mention the result of the two cases:
If the index falls and breaks the 55% support, the current altcoin season will continue into another big and good bullish wave.
If the index rebounds and breaks the 60% resistance, the rise of alternative currencies will be postponed until Bitcoin stabilizes at its new peak and the acquisition begins to decline, but here it will be a season of extraordinary alternative digital currencies in which we may see currencies reach numbers that we have not seen before and we will see a very large number of multiples, because at that time there will be a lot of money in the market, but after the short term we will see some corrections that may reach 40 and 50% which may cause the liquidation of some futures greedy and some small investors to exit and do what is called a shakeout, which is shaking the market like shaking a tree so that the weak leaves fall.
The best step you can take as a trader in your life and it may change your life for the better significantly is to be consistent and not leave your centered position and to stick to the indicators, which are basically there to be read and not ignored. If the market continues its rise, here we are, and if the market postpones and falls a little until Bitcoin ends its cycle, we reinforce when it falls 30% or more and put some nuts and a cup of tea and watch.
There are disastrous mistakes that people make at these stages, such as exaggerating futures contracts, resorting to groups known as pumps, or to scammers’ traps, or moving from one currency to another while chasing green candles like someone chasing a mirage.
A long article and a lot of explanation, but unfortunately you will not find this information anywhere else. All I am doing is publishing it in the hope that it will protect someone from losing their savings or make someone happy with their profits.
