Dry goods are here, brothers! I’ve personally practiced this myself, and it really still has some depth to it. For the Sol trend movements that many big players can’t understand, you can actually interpret them using the 1-2-3 rule.

First, let’s talk about the three main types of trend. The longest is the primary trend—you may need to run it for several years; second is the corrective trend, usually an adjustment over a few weeks or a few months; and finally there are short-term fluctuations, which are happening every day. Behind all these trends, they actually follow the same three stages—first market sentiment (greed or fear), and then fundamentals reflecting, and finally back to sentiment. That’s why the market keeps replaying itself over and over again, because human nature never changes.

Speaking of the 1-2-3 rule, this tool is especially useful in the crypto space. The core logic is really three things: the trend line is broken, the price stops making new highs or new lows, and then it breaks through a key level. As long as any two of these three conditions are met, you can basically confirm that the trend is about to reverse. The best time to enter usually appears only after the third-step confirmation. What’s interesting is that the sequence of the 1-2-3 rule can be flexibly rearranged—it doesn’t necessarily have to follow the order of 1-2-3, but in the end you must complete that breakout confirmation.

Then there’s the 2B rule, which is an advanced way to play the 1-2-3 rule. Its feature is that it can give you signals earlier. For example, in an uptrend, if the price breaks above the previous high but can’t keep rising—instead, it quickly falls back and breaks below the previous high, that’s called a false breakout. The 2B rule is designed to catch these false breakouts, giving traders an early warning. The risk is indeed higher, but if you test with small positions and combine it with stop-losses, you can still find earlier entry points.

My suggestion is to use these two rule sets together. First, use the 2B rule to spot potential reversal signals, then enter with a small position to test the waters, and then decide whether to add to your position based on the confirmation from the 1-2-3 rule. The most important is risk management—no matter which set of rules you use, you must set your stop-loss properly.

There are also a few details to pay attention to. The reliability of a trend line depends on how many points it touches; a trend line with more than three points is definitely stronger than one with only two. With how volatile the crypto market is, simply looking at the 1-2-3 rule isn’t enough—you also need to combine market sentiment and trading volume to judge. Finally, you need to keep training and summarizing, gradually forming your own trading system.

Let’s encourage each other, everyone. The market is ever-changing, but the rules are always there.