Have you ever held a beach ball underwater and pressed down?
You can feel the pressure on your arms – the beachball is trying everything to float back up.
So what happens when you let go? It jumps into the air!
Once that pressure holding it down eases, it has nowhere to go but up.
The market is the exact same.
When everything’s selling indiscriminately, we want to look for the sectors, stocks, or in this case, cryptocurrencies that are bucking the trend and pushing up against your arms.
So what’s going to happen when that selling, that force holding the beach ball gives up?
It’s gonna shoot higher!
That stock or cryptocurrency closing the day higher in the face of broad distribution is likely to be the next leader when that force holding everything down subsides.
We saw this take place with Solana in August, and we know how that turned out…
Now that the market finds itself beaten and bruised over the last few weeks, we need to ask the same question – where’s the relative strength?