Some of you are asking, what is a "market pullback" or "market correction"? Let me explain it my way!
Imagine you are selling potatoes. One day, someone announced a fast food expo where everyone could bring French fries to compete to see who could be the best French fries shop in town! Suddenly, everyone started buying potatoes to make French fries. With demand high and supply limited, prices begin to rise.
Now some smart (but dishonest) people started buying potatoes in large quantities, hoarding them, and then selling them at a higher price. We call this the “Potato Alliance.”
After a while, the price soared by 60%! But then the government stepped in, revealed the actual supply of potatoes, and announced a market correction that dropped prices by 10%. This is a price correction.
The next day, sellers from other cities brought their potatoes, and as competition increased, the price dropped another 25%. This is what we call a pullback.
Then, all of a sudden, the government announced they were going to import potatoes from China 🇨🇳 and just like that - boom! The market crashed and prices plummeted by 50%. This is a market crash.
Finally, someone did their homework and revealed that Fast Food Expo is actually a scam! Once the news spread, the price of potatoes collapsed to almost zero. This is what we call market fraud.
So, which one seems to be the right indicator for the current bear market trend? My guess is a market crash. What do you think?
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