In the midst of strategizing, we can win from a thousand miles away. Hello everyone, I am Lin Chao, a global financial market observer, focusing on cryptocurrency market analysis, bringing you the most in-depth trading information analysis and technical teaching.

Recently, Lin Chao's private messages have exploded, and many users are getting anxious, sending messages to ask whether there will be further declines and how long it will last. If I hadn't reduced my positions at high points, I would likely be facing the same issues as everyone else.

Long-term followers of Lin Chao should know that during this market cycle, I had already made a complete trading plan back in April. During the decline, I reminded everyone to accumulate positions at lower prices, and by June, I advised holding. Starting from mid-July, I began to remind everyone to take profits at high points. Now, we are in the planned correction phase, and I have started the next round of position accumulation. When you are preparing to start a trading round, it should not be a random event, but a determined event. You should know what actions to take at what time, rather than thinking about which direction the market will go while holding positions.

During the process of holding positions, many people often encounter situations where they see the trend suddenly reverse and are unsure whether to take profits early. After entering a position, they may find themselves in a loss and are unclear whether to execute a stop-loss. When news is released during the holding period, they do not know how to react. If you are often troubled by these questions while holding positions, it is likely because you have not formulated a detailed holding plan in advance.

Lin Chao believes that for most traders whose mindset is not yet mature, the holding period is also when your trading mentality is the most fragile. Watching the numbers on your account fluctuate back and forth, many people find it hard to calm down, and various psychological issues will come into play. If you try to analyze the market at this time to decide your next move, it is likely to lead to undesirable results. Therefore, to achieve reasonable position management during the holding process, we should not wait for the market to show signs before making analyses and decisions, but rather should prepare response plans for various market conditions in advance—what to do if the market suddenly accelerates; what to do if the market experiences a deep pullback; what to do if the market encounters breaking news. Traders must plan their response strategies for various scenarios before placing orders, and during the holding process, they should only execute, ensuring that position management is logical and not driven by panic.

To put it metaphorically—the market is like a battlefield, and every trader is like a soldier on the battlefield. Discussing the next course of action in the trenches amidst heavy fire is too late and usually irrational. Only by formulating various battle plans in advance to respond to different scenarios can we ensure smooth operations and increase our survival probability—this is also true for traders. When encountering a crisis during the holding process, what should come to your mind is not "What should I do now?" but "It's time to use Plan B (or Plan C, or Plan D)."

Lin Chao boldly guesses that many of you have been opening your trading apps more frequently in the past couple of days? Are you occasionally tempted to break your own trading rules? I want to remind everyone that you actually need to create some distance from the market; do not stick to the screen all day. Learn to reasonably spend your time and enrich your personal life. Only in a relatively fulfilling state of life can you avoid feeling uneasy about not trading throughout the day and not fall into unnecessary self-blame due to individual trading losses. If the tension in your mind is too high, it will actually be detrimental to trading. Creating appropriate distance from the market can greatly alleviate various psychological issues that arise in trading.

Lin Chao's Summary

In fact, I briefly analyzed the general direction for the future in yesterday's article. I see this round of correction as healthy and necessary. Whether in financial markets, at the national level, or at the personal level, separation and reunification are inevitable. If you are a long-term value investor, there is no need to panic over a temporary pullback.

For spot users, I do not believe that this moment is a good time to accumulate positions. First, from the news perspective, there are still several very important matters that have not been settled. One recent issue is the US-China tariffs on August 1. There are rumors that the overall direction is positive, particularly regarding chips and rare earths, which have been negotiated. However, no one knows the specifics of the negotiations, and the authenticity of the news source cannot be confirmed. We do not speculate; we only look at the results. If it is confirmed to be developing positively, it will undoubtedly be an important fuel for advancing the bull market.

Secondly, regarding Trump's pressure on Powell to force the Federal Reserve to cut interest rates, although this has been ongoing, the frequency has been increasing recently. I estimate that there will still be no results before September. This event should be the last leg of the bull market. Once a rate cut is confirmed, the market may end amidst cheers. Therefore, my judgment is that this round of the bull market has been advanced, driven by news expectations. Thus, I remind everyone that to trade well, especially in international financial markets, you must have a very high sensitivity to current events.

After three days of correction, it is clear that Bitcoin and Ethereum have shown different market behaviors, but the good news is that both have recently held at key support levels, especially Ethereum at the strong support of $3500-$3600, which even made it hard for me to confirm whether there were signs of a pullback. In fact, the bearish momentum has not been fully released, and if the pullback period is too short, there may be repeated sell-offs after a false rally. Especially for users holding small altcoins, such as DOGE, SUI, these marginal altcoins do not have the ability to follow mainstream currency trends; their gains will not exceed those of BTC and ETH, but their losses will definitely be greater than those of mainstream currencies. Users holding such coins must learn to hedge potential risks with contracts.

The success of investing depends not only on choosing good targets but also on when to buy and sell. Preserving capital and making good asset allocations are essential for steady progress in the ocean of investment. Life is like a long river flowing into the sea; what determines victory or defeat is never the gains and losses of a single pass or a moment, but rather planning before action and knowing when to stop to gain.

The global market is ever-changing, and the world is a whole. Follow Lin Chao to gain a top-tier global financial perspective.

This article is merely a personal opinion and does not constitute any trading advice. The cryptocurrency market has risks; invest cautiously!

For real-time consultation, feel free to follow the public account: Lin Chao on Cryptocurrency.

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