Why You Go Long at the Top and Short at the Bottom
Every exchange keeps a number that most traders never look at: the ratio of accounts holding long versus short. When Bitcoin printed its 2021 high near $69,000, that ratio was screaming long. When it bottomed in late 2022 around $15,500, the same crowd was piled into shorts. Same people. Wrong side. Both times.
This isn't bad luck. It's structural. The crowd doesn't just occasionally get the extremes wrong — it gets them wrong in a way you can almost set your watch by.
Here's the mechanism. Retail sentiment is one of the most reliable contrarian indicators professional desks watch, and the reason is simple. When price has ripped 40% in three weeks, the people who feel most confident are the ones who already bought. Their buying power is spent. There's no one left to lift the offer, so the market tips over. When the crowd is maximally long, the fuel...
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