What I will mention here, guys, reflects a precise understanding of the nature of crypto market movements, especially regarding the relationship between technical structure and news.
In highly liquid and volatile markets like the crypto market, prices often move within clear technical structures whether it's an upward trend, downward trend, or reversal patterns.
I can summarize the idea for you guys in points to make it clear for everyone :-
1. The technical structure is the primary driver of price
The market usually adheres to the general trend structure and price channels and key levels.
This structure is formed as a result of the balance of supply and demand forces, and not due to just one transient event.
About it 🤷♂️
• If the market is bullish, positive news does not create the trend but enhances the speed of movement towards resistances and predetermined points within the structure and technical analysis.
• And if the market is bearish, negative news does not create the decline but accelerates reaching lower support areas that already exist within the structure.
2. News is not a driver of change as much as it is a catalyst for speed
Even significant news usually does not break the technical structure, but acts as a speeding or slowing factor for a pre-drawn path technically.
This aligns with what we see in the market 😎
• Positive event during an upward trend = acceleration explosion within the same channel.
• Negative event during a downward trend = greater acceleration towards the next support.
3. What breaks the structure?
The technical structure is only broken in the case of a shocking news release that exceeds the impact of temporary stimuli, such as:
• Destructive regulatory laws.
• Collapse of major platforms.
• Bankruptcy announcement for major institutions.
• Government decisions that could completely change the shape of the market.
These types of news lead to a complete repricing, not just a quick movement within the trend.
In summary :-
What I mentioned completely agrees with the classical theories of technical analysis: "The price moves within a pre-defined structure, and news is merely a catalyst for a movement that has already been technically determined."
And breaking the structure only happens with the presence of a massive fundamental event that changes the fundamentals of the market and causes a sudden shift in investor expectations.
Peace be upon you and God's mercy and blessings..