1. Volume-Price Coordination to Spot Tops and Bottoms
Volume Observation During Price Rise and Correction:
When a pullback occurs during the price rise, the performance of the trading volume is crucial. If the trading volume does not significantly decrease during the pullback, it means that market enthusiasm remains high, like a raging fire with continuously added fuel. The subsequent rise is likely to continue.
However, if the price of the currency rises to a new high, but the trading volume decreases instead of increasing, it is like a grand banquet gradually dispersing, with guests leaving one after another. In this case, the top is likely to have quietly arrived, and investors need to remain vigilant and keep their nerves taut.
Searching for Buy Points While Hovering at Low Levels:
When the price of the currency lingers at low levels for a long time, do not rush to enter, lest you become the 'bag holder'.
One should patiently wait for it to test the bottom a second time, just like a diver quickly rebounding after diving to a certain depth. Once such a reversal trend appears, it is like hearing the starting gun; this is an excellent buying signal, and entering at this time is likely to catch the 'express train' of subsequent price increases.
2. Breakthrough Signal Indicates Stop of Price Fluctuation
Wait and See After the First Breakthrough:
If the price of the currency has been 'hibernating' at the bottom for a long time, and then there is an upward breakout but quickly falls back to the original position, this is likely just a 'false move', and investors should not be deceived by it.
At this time, one should stabilize their mindset and refrain from acting, waiting for it to make a second effort and break upward again. Only then is there a possibility of truly starting a significant upward trend, and the increase at that time is often considerable, with the harvest period perhaps just around the corner.
Sideways Fluctuation Warning Risk:
After experiencing a continuous and rapid rise, the price of the currency enters a sideways phase, starting to fluctuate slightly up and down. It seems calm on the surface, but in fact, there is a hidden crisis.
This is often a 'gentle trap' set by the market to attract investors to enter. In reality, the risk has been growing like a snowball in the dark.
In this case, everyone must set a good stop-loss 'safety net' and take preventive measures in advance to avoid falling into a deep 'quagmire' of being stuck.