When will the market actually top? Let me explain it with a funny logic;
1. (Fish head) When the price hits the bottom or starts to rebound, only 30% of people are willing to take action to buy or go long, leaving 70% of people who missed out on the opportunity to watch foolishly;
2. (Fish body) When the price rises to a certain level, 30% of the people who bought partly take profits, and the price shows a small correction. The people who missed out on the opportunity before decide to buy, and they occupy 40% of the total funds, and the remaining 60% of people watch foolishly;
3. (Fish tail) The price starts to rise again, and 40% of the people who bought choose to continue holding, while the remaining 60% of people also decide to buy, which means that the entire market is buying and going long, and no one misses out on the opportunity;
4. (Top) After the price rises wildly and rapidly, the earliest 40% of the funds decide to sell. Since there is no one who missed out on the opportunity to take over at this time, the price quickly falls back, causing the remaining 60% of people to be trapped;
5. Since the remaining 40% of profitable funds are always less than the 60% of trapped funds, in other words, the supply begins to exceed the demand for a long time, so the market goes bearish;
6. Anyone who buys the bottom in advance in a bear market will become a new supplier after being trapped. The logic is the same as in a bull market;
7. Until the price drops to a level that causes 60% of the trapped funds to gradually sell until the amount is less than the potential buying funds, the price begins to stop falling, supply and demand are balanced again, the supply is gradually exhausted in the bear market, and the early profit funds as potential demand once again occupy the majority;
8. (Fish head) When the price hits the bottom or starts to rebound, only 30% of people are willing to take action to buy or go long, leaving 70% of people who miss out to watch stupidly;
9.......
This cycle sounds simple and crude, but from the perspective of supply and demand, it happens to be a virtuous cycle, because as long as the profitable funds in a market are still willing to re-buy or there is a continuous inflow of new funds, then the price of this market will get higher and higher, but it will fluctuate greatly in the process;
For BTC, which is not affected by external factors such as performance, financial reports, and management changes, the simple and pure supply and demand relationship is the most important force that determines the price, so the price fluctuation of BTC in the past 10 years has been so high;
Back to the present, if everyone around you is going long, and even your group chat has something like "you can make money as long as you go long in this market", then the top is likely to appear soon because no one will take over.
Fortunately, I haven’t seen any similar comments yet, but if the price breaks through a new high, I guess such comments will pop up soon.