Cryptocurrency News
March 10 Hot Topics:
1. Today's Fear and Greed Index has dropped to 20, with market sentiment shifting to "extreme fear."
2. Analysis: MSTR's net asset premium rate has rebounded by 23% from its low, possibly preparing for another large-scale Bitcoin purchase.
3. AI Agents continue to decline, with the overall sector market cap falling below $5 billion. Since the launch of $Trump, most have dropped over 90%.
4. The altcoin season index currently reports at 18, close to its annual low.
5. Data: The total market cap of stablecoins has reached $22.7276 billion, growing by 1.32% over the past 7 days.
Trading Insights
What to do when encountering a false breakout in trading? False breakouts are common in trading. After setting a stop-loss, what should you do when you encounter one?
What is a false breakout? A false breakout occurs when the price breaks through a key support or resistance level but does not continue in the breakout direction, quickly returning to the original price range. For example, if a stock price breaks above a previous resistance level, briefly rises, but then quickly retraces back below the resistance level and starts to decline, those who chased the price up get trapped; this is an upward false breakout.
Why do false breakouts happen?
- 1. Insufficient volume: A true breakout usually sees a significant increase in volume, driven by new funds pushing the price. In a false breakout, the volume is low, or it quickly decreases after the breakout, lacking the momentum to sustain the new price.
- 2. Market manipulation: Large funds or institutions may intentionally create a false breakout to attract follow-on trading, then operate in the opposite direction. Many traders set stop-loss and limit orders at key points, causing temporary price fluctuations. Without subsequent buying or selling support, the price returns to its original position. Some may also create false signals using undisclosed information.
- How to identify a false breakout?
- 1. Check the volume: If the volume does not significantly increase during the breakout, it is likely a false breakout; true breakouts usually have larger volumes.
- 2. Check the duration: False breakouts last a short time, with prices quickly returning to the original range. If the price cannot hold the new position for a day or two after the breakout, it may be a false breakout.
- 3. Multi-indicator verification: Combine multiple technical indicators for judgment. If only the price breaks out while other indicators do not confirm, the likelihood of a false breakout is high. True breakouts have small retracement amplitudes and can find support, while false breakouts have larger retracement amplitudes. If there is no significant news and market sentiment has not changed due to the breakout, it may also be a false breakout.
- How to handle a false breakout?
- 1. Decisive stop-loss: Upon discovering a false breakout, decisively stop-loss. Theoretically, one could wait for effective confirmation before exiting, but in practice, waiting for confirmation carries significant risk. The more critical the support or resistance level, the more volatile the market will be after the breakout. Delayed confirmation can lead to risks far exceeding the original plan, and the standards for effective confirmation can be vague, affecting stop-loss execution. Therefore, it is essential to strictly execute stop-loss points at specific price levels.
- 2. Accept losses: It is normal to have a certain percentage of losing trades in overall trading, which is the cost of avoiding significant losses and capturing major trends. After a stop-loss due to a false breakout, if the price returns to the original position, it may seem like a loss, but from an overall perspective, reasonable stop-loss can ensure capital safety and achieve profitability. Just like gambling, although frequent stop-loss mistakes occur, ensuring that capital does not get wiped out and losses do not exceed 10%, while profits far exceed losses, makes one a winner.
- 3. Reverse operation after confirmation (suitable for experienced traders): Investors with experience and high risk tolerance may consider reverse operations after confirming a false breakout. For example, after being cut off twice by false breakouts, entering in the opposite direction after the third confirmation may lead to significant profits, but the risk is high and requires careful operation with various analytical tools.
LIFE IS LIKE
A JOURNEY ▲
Below are the real trading group orders from the Big White Community this week. Congratulations to those who followed along. If your operations are not going well, you can come and test the waters.
The data is real, and each order has a screenshot from the time it was issued.
**Search for the public account: *Big White Talks Coins*
BTC
Analysis
Bitcoin's daily line fell from a high of around 86,500 to a low of around 79,950 yesterday, closing around 80,750. The support level is near 80,000, and a pullback can be bought around there. The resistance level is near MA200; if broken, it can be seen around 85,250. A rebound to that area can be a short opportunity. MACD shows increasing bearish momentum, forming a death cross. The four-hour upper resistance is near the MA7 moving average; if broken, it can be seen around MA14. A rebound to that area can be a short opportunity. MACD shows decreasing bearish momentum.
ETH
Analysis
Ethereum's daily line fell from a high of around 2,215 to a low of around 1,990 yesterday, closing around 2,020. The support level is near 1,995, and a pullback can be bought around there. The resistance level is near the MA7 moving average; if broken, it can be seen around MA14. A rebound to that area can be a short opportunity. MACD shows decreasing bearish momentum. The four-hour upper resistance is near MA14; if broken, it can be seen around MA60. A rebound to that area can be a short opportunity. MACD shows decreasing bearish momentum.
Disclaimer: The above content is personal opinion and for reference only! It does not constitute specific operational advice and does not bear legal responsibility. Market conditions change rapidly, and the article has a certain lag. If you have any questions, feel free to consult.
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