Is extreme greed the calm before the black swan?
Currently, the fear and greed index reached a high of 90 yesterday. This number was seen once before during the big surge in March this year. If the market replicates that situation, it could lead to a rapid downturn, liquidating long positions, which we must be cautious about. Moreover, since the big coin broke through the temporary historical high of 93000, it has been in a high-level consolidation for a week now, currently entering a phase of extreme tug-of-war, unable to go up or down. So what should we do next? Let's discuss the big coin:
The reason it has not dropped below 90K for a long time may be that the emotions brought by the election have not completely dissipated. Trump has been maintaining friendly contact with the crypto circle recently, but until he officially takes office, most of the movements are within the market. Therefore, the potential for further upward movement is not very large at the moment. So what situation could trigger an upward movement?
Next year, when that man officially takes office and brings a series of favorable policies for the crypto circle, coupled with interest rates lowered to a neutral rate of around 3-3.5, and a release of ample liquidity, only then will the outside money truly enter the market. At that time, it might push the big coin up to six figures, around 150K.
As for the present, a strong and forced rise is not very healthy; a reasonable correction is also a necessary part of the market.
Last night, a new high was broken again; we need to be cautious. Not to mention a black swan, but a significant correction is likely on the way!
Next week, I will guide fans to ambush a MEME on the SOL chain; doubling your investment should be no problem.
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