Looking at K-lines is not as good as understanding human nature.
When I first entered the crypto world, I was also obsessed with the colorful K-line charts, staying up all night to watch the market, only to see my account balance decrease. Later, I realized that most people are not looking at the same chart as the market makers.
After countless losses and reflections, I discovered three major hidden signals behind the K-lines, which helped me successfully predict the 15% crash of BTC last year. Today, I will share these practical experiences with everyone.
1. True and false breakouts: The most ruthless 'fishing line' trick.
The vast majority of retail investors rush in mindlessly when they see the price break above the previous high, only to find themselves trapped the next second. This is the 'fishing line' trick that the market makers love the most—deliberately creating false breakouts to lure in retail investors.
How to identify genuine breakouts? I have summarized two iron rules:
Volume is key: A true breakout must be accompanied by a significant increase in trading volume, at least more than twice the recent average trading volume. If the price hits a new high but the volume is insufficient, it is likely a trap.
Time validation is a safeguard: You cannot just look at a single candlestick; at least two to three consecutive 4-hour candlesticks need to stay above the resistance level to confirm a valid breakout.
Remember January 2024, when ETH hit $2100, it was clearly a volume breakout, yet the forum was filled with FOMO sentiment. What was the result? It plummeted 15% that day, and those who jumped in were trapped tightly.
2. Hidden accumulation: The traces of market makers secretly accumulating.
Market makers will not shout loudly to tell you to pump the price, but will quietly lay out their plans when no one is paying attention. When the price seems calm, it is precisely when you need to be most vigilant.
I usually judge whether market makers are accumulating based on two signals:
Long lower shadow + shrinking volume reversal: After the price is suppressed, it quickly rebounds, forming a long lower shadow, followed by a decrease in trading volume, indicating reduced selling pressure and that the market makers are buying.
Sudden increase in volume at the end of sideways trading: After a long period of sideways trading, a sudden appearance of a volume-increasing bullish candle often signals the start of a move.
I particularly like to look for the "three-pins bottom" structure on daily charts—three consecutive tests of the same support level without breaking it. Once this pattern forms, the probability of a subsequent rise is very high. Checking on-chain data to see if whale addresses are active in the bottom area will increase accuracy.
3. Death reversal: The ultimate signal for escaping the top.
In the crypto space, the scariest thing is not a crash, but being completely unaware before the crash occurs. When everyone is in a frenzy, the risk is already quietly approaching.
These two reversal patterns have saved me from danger multiple times:
Hanging man: A long upper shadow, a small body, and a closing price near the lowest point. This indicates that the bulls are no longer able to maintain the high, serving as a warning signal for a trend reversal.
Evening star: Composed of three candlesticks—a large bullish candlestick, a doji (or small candlestick), and a large bearish candlestick. This is one of the most classic top reversal patterns; once it appears, it warrants high vigilance.
In November 2023, when BTC hit $38,000, I observed the "double top + evening star" combination, which subsequently dropped to $35,000 within 7 days, with countless long contracts being liquidated. It was precisely due to my sensitivity to these signals that I locked in profits early and avoided losses.
In closing
The fundamental reason most retail investors lose money is not a lack of technical skills but that they cannot understand the true language behind candlesticks. Market makers exploit retail investors' half-understanding of technical analysis by creating false signals to induce wrong operations.
The real core is not to chase every fluctuation but to understand market sentiment and the intentions of the main players. When I monitor large transactions and on-chain data and find that the movements of market makers are consistent with candlestick signals, I will decisively take action.
Investing is a cognitive game. "You can never earn money beyond your cognitive range." This is especially applicable in the crypto space. I hope these experiences can help you avoid detours, as protecting your capital is the most important thing in this highly volatile market. Follow Brother Bin to learn more about first-hand information and precise knowledge in the crypto space, becoming your navigation in the crypto world; learning is your greatest wealth!#加密市场回调 #全球科技股抛售冲击风险资产 $ETH
