This verified trading model for retail investors in the cryptocurrency market has a win rate as high as 91%. Mastering it can help you avoid most traps and make the path from 100,000 to 5,000,000 more stable.
1. Diversify funds, strictly control risks
Divide funds into 5 parts, using only 1/5 of the position each time. Set a 10% stop loss, so even if there is a misjudgment, a single loss only accounts for 2% of the total funds. Even with 5 consecutive mistakes, the loss would only be 10%. If the judgment is correct, set a profit target of over 10%, allowing the profit-loss ratio to naturally lean positive. A strict mechanism for fund allocation and stop loss is the underlying logic to avoid deep losses.
2. Follow the trend to increase win rate
The core of truly high win rates can be summarized in two words: follow the trend.
Rebounds in a downtrend are mostly traps for buyers, while pullbacks in an uptrend are often opportunities for buying low. Compared to the extremely high risk of bottom fishing, following the trend and finding low points in the right direction will greatly improve long-term win rates.
3. Avoid short-term skyrocketing coins
Whether mainstream or altcoins, very few can sustain multiple waves of main upward trends. The cost of continuing to rise after a short-term surge is extremely high, and stagnation at high levels often means an inability to rise further, leading to a high probability of a pullback.
However, the most common mistake retail investors make is blindly chasing highs, ultimately getting trapped. Avoiding skyrocketing coins means avoiding high-risk zones.
4. Use MACD to determine entry and exit signals
MACD is a very useful trend indicator:
When DIF and DEA cross above the 0 line and break through it upwards, it is a solid entry signal;
When they cross below the 0 line and continue downwards, it is advisable to decisively reduce positions to avoid profit erosion.
Following signals can reduce emotional trading.
5. Refuse to average down on losses, only increase positions on profits
Averaging down is the biggest trap for retail investors: the more they lose, the more they average down, and the deeper they get trapped without a chance to recover.
Always remember the iron rule of trading: **never average down when in loss, only increase positions when in profit.
Let profits multiply, not let losses snowball.
6. Persist in reviewing trades and adjust strategies in time
A review must be conducted after every trading day:
Check if the reasons for holding coins have changed, confirm through weekly charts whether the overall direction meets expectations, and whether the trend has shifted.
Adjust strategies based on review results to continually correct mistakes, making the trading system more mature and avoiding repeated pitfalls.
