First, we need to know about the SOS signal according to WICKOFF, which is where the organization starts to inject a large amount of money to begin buying BTC at high price levels (often found at resistance areas or above resistance areas) to achieve two objectives: the first is to absorb all the profit-taking of small investors, and the second is to start signaling for other smart money flows to begin agreeing to enter the new price push process of BTC.
And during this SOS process, many patterns will appear depending on the current economic situation and many other factors, but I will only talk about it from a technical analysis perspective. To make it easier to distinguish, I will divide the SOS signals into two types: strong SOS and weak SOS.
1. Strong SOS is where institutional cash flow buys extremely large amounts at the psychological resistance area and does not allow the price to drop at the resistance price level in the accumulation range.
You can specifically look at the strong SOS signal during the period of 6-11-2024 (highest volume from 6-8-2024 to 6-11-2024, price increases sharply above the resistance level of 72.6k) and after having a strong SOS signal, we need to see the consensus of other organizations in subsequent sessions in maintaining high cash flow to absorb the remaining profit-taking of individual investors.
2. Weak SOS is where institutional cash flow also starts to buy at the resistance price level in the accumulation range, causing the price to still rise, but the trading volume remains at an average or low level.
Due to low cash flow, the organization’s ability to absorb the profit-taking pressure of individual investors decreases, so it is completely normal for the price to drop deeply to the previous support levels; however, after this decline, we need to see cash flow return and maintain at a volume that can be lower than or equal to the previous cash flow activation SOS session.
The second pattern of weak SOS can transform into strong SOS: it can activate a breakout above the resistance area, although the volume may be low compared to previous sessions; however, the price must maintain the psychological resistance level, and the cash flow must continuously sustain to absorb the profit-taking force of institutional investors. If subsequent sessions do not see cash flow return, we can confirm that this is a weak SOS session. However, if there is a confirmation session with superior cash flow and liquidity maintained to absorb profit-taking pressure, we can confirm this weak SOS session as a strong SOS process.
And at the current stage, we see BTC in a weak SOS pattern with liquidity activating above the resistance area of 107k. However, the bright spot currently is that the price has not been pushed down below the resistance area of 107k. If in the upcoming sessions, cash flow continues to maintain with an average volume like the two weak SOS cases mentioned above, and then there is a cash flow returning with a larger or equal volume, we can confirm BTC is entering a new uptrend. Otherwise, if any case occurs outside of the two above SOS cases, we should withdraw capital and wait for a weak or strong SOS phase in the upcoming stage.
