The most exhausting part of trading contracts is never the losses themselves, but rather the endless vicious cycle that ensues after losing control of one's mindset.
The vast majority of retail investors have almost tripped over all the fatal pitfalls along the way: letting emotions take over during a bull market and heavily chasing highs, panicking and cutting losses at the slightest pullback; using leverage indiscriminately, holding blindly after a small profit, stubbornly refusing to admit mistakes after losses, leading to direct liquidation and deep entrapment; following the crowd blindly after seeing others post profits, then frantically cutting losses when negative news breaks; staying up all night watching the market, letting emotions swing with the market fluctuations, resulting in diminishing capital.
Even if your market judgment is exceptionally accurate, if you are led by emotions and engage in reckless trading, you will continue to incur losses. In the end, trading is fought not on insider information or complicated indicators, but on one's own discipline and temperament.
Do not rely on sudden luck to gamble on the market, instead, impose a simple, stable set of trading rules on yourself: only enter when the trend is clear, observe the market during a consolidation phase, always operate with light positions, strictly execute profit-taking and stop-loss, and avoid bad habits like over-leveraging, stubbornly holding onto losing positions, and frequently trading late into the night.
Learning technical analysis can be done quickly, but developing a stable trading mindset can only be honed through day-to-day practice.
If you are currently experiencing continuous losses, with your operations completely distorted, trapped in a vicious cycle of chasing highs and cutting losses, rather than gambling on the market, it is better to follow successful traders, patiently develop your temperament, and build a complete closed-loop trading system, relying on compound interest for long-term stable returns.
First, let's look at the four-hour chart of Bitcoin. In the chart, the red bearish volume curve clearly shows that selling pressure has been weakening. The current price has just retraced to the key Fibonacci support level of 0.382, specifically around just above 61500.
Now discussing the most concerning scenario of the CPI tonight: even if this data exceeds market expectations, it is very hard for the price to drop below 61000. This judgment is based not just on technical indicators but stems mainly from the exchange order book. Looking back at the pullbacks on June 25, July 1, and July 9, every time the price falls into the 61500-62000 range, there have been large buy orders emerging to support the price, indicating very solid buying strength. Even if tonight’s CPI data is bearish, the buy orders in this range will not simply vanish.
If bad data triggers a quick descent, and the price drops into the 61000-61500 range and shows a long lower shadow coupled with increased volume, it presents a great opportunity to go long. This is supported by three layers of logic: the bearishness is absorbed at once, the order book below provides strong support, and the price lands at a critical support level, ensuring high safety.
At this stage, BTC has gathered three preconditions for a bottoming long signal: first, bearish volume is continuously declining; second, a standard bullish divergence in volume and price has appeared; third, it has retraced to the strong support zone of 0.382. Now, we just need to confirm the candlestick pattern; waiting for a long lower shadow to close, followed by consecutive bullish candles, will complete the long signal, and this confirmation is likely to occur after the bearish CPI data is released.
On the other hand, if the CPI data is lower than expected, the market will directly initiate a rebound, and the long signals can quickly form; however, the downside is evident: the entry point will be much higher than around 61000, making the risk-reward ratio much less favorable compared to buying the dip during a rapid decline.
Finally, here are two actionable plans after the CPI data is released tonight:
Data is bearish, and the market quickly tests the 61000-61500 range: wait for the emergence of a long lower shadow and increased volume, and then set up long positions accordingly;
Data is bullish, and the market directly rallies: do not chase highs, patiently wait for a pullback before entering.
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The market review does not constitute investment advice, cryptocurrency is highly volatile, and contract trading carries a high risk, please manage your positions wisely.
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