December 31 Market
Technical Analysis:
BTC
1. The daily chart shows a volume increase with a bearish candlestick. The spiral bearish candlestick is negative, but there are mixed opinions. Recently, there have been multiple tests of the previous low support; after briefly breaking through, there was a quick recovery, indicating strong resistance from bulls.
2. Based on the recent decrease in both magnitude and speed, pay attention to the B-wave rebound after the end of the A-wave — overall, maintaining a high-level consolidation.
3. Patterns and Principles
(1) Short-term oscillating downward forms a wedge; right-side trades for long positions need to focus on buying opportunities after the breakdown of the descending trendline based on the 123 principle.
(2) This year to date, every time a wedge pattern appears at a high price, there has been a rebound starting from the Fibo 0.382 support level, with only May dropping to Fibo 0.5, which serves as a historical reference.
4. Note: During the monthly and yearly closing phases, sudden technical breakouts cannot be ruled out, but based on the historical adjustments from high positions, since the beginning of 2023, only the decline from early this year to August has exceeded 20%. The adjustment magnitude during other periods has generally remained around 20%. Corresponding to the current pullback, using 20% as a baseline, the lower low maintains above the main upward trendline — the foundation of the bull market still exists, and a pullback means buying opportunities.
5. Existing Issues:
(1) Left-side and right-side trading
Left-side trading:
Disadvantages: Predictive bottom-fishing goes against short-term trends; based on the upward trendline, there is an approximate 8% space, making short-term trading unsuitable.
Advantages: Even if there are potential spikes due to closing issues in the short term, based on the above analysis — limited decline and strong support below,
(1) It is beneficial for bottom-fishing, capturing the price.
(2) If the market declines afterward, one can buy on dips to gain a cost advantage on the average price.
(3) Avoid sudden bullish starts, losing trading opportunities — suitable for medium to long-term positioning.
Right-side trading:
Disadvantages: Waiting for price confirmation to enter long positions will result in losing some bullish profits (not the optimal low point) and carries the risk of potential false breakouts when chasing highs.
Advantages: Aligns with trend trading, suitable for short-term trading.
6. In summary, historical patterns (high-level pullback space + formations) indicate that short-term declines are limited. In situations where short-term movements are difficult to grasp, one can adopt a phased spot layout.
