In the crypto world, 3,000 yuan is about 400 USDT! Recommended optimal strategy: use 100 USDT for each contract, gamble on trending coins, and set profit-taking and stop-loss at 100 for 200, 200 for 400, and 400 for 800. Remember no more than three times! Because the crypto world requires a bit of luck, gambling like this can easily earn 9 times and then one big loss! If you pass three rounds with 100, your principal will reach 1,100 USDT! At this point, it needs to settle.
In-depth research: Spend time researching and understanding the cryptocurrency market, focusing on the fundamentals, technology, team, and market trends of projects. Understand the risks and potential of different projects.
Diversified Investment: Spread funds across multiple promising cryptocurrency projects to reduce the risk of a single investment. Choose projects with long-term growth potential and good fundamentals.
Time Holding: Consider adopting a long-term investment strategy, holding tokens of quality projects, and believing in its long-term value appreciation potential. The cryptocurrency market is highly volatile, requiring patience and a long-term perspective.
Cautious use of leverage: If you choose to use leveraged trading, ensure you fully understand the risks of leveraged trading and reasonably control the leverage ratio.
Active Trading: Engage actively in trading and capture market fluctuations. Understand technical analysis tools and indicators, learn trading strategies, but be aware of market risk and volatility.
Continuous learning and adaptation: The cryptocurrency market changes rapidly. Keep learning about the industry and market, and flexibly adjust investment strategies based on market conditions.
Risk Management: Ensure to establish appropriate risk management strategies, including setting profit-taking and stop-loss levels, reasonably controlling position sizes, and maintaining sufficient cash flow.
At this time, it is recommended to use a three-pronged strategy to play two types of orders in one day: ultra-short orders and strategic orders. If opportunities arise, then use trend orders. Ultra-short orders are used for quick strikes, targeting the 15-minute level.
Advantages: High returns
Disadvantages: High risk only doing second-type orders at the level of Bitcoin and Ethereum. Strategic orders, using small positions like 10 to 15 USDT to do contracts around the 4-hour level, and saving profits, investing in Bitcoin weekly. Third type, trend orders for medium to long-term trading, entering directly when the opportunity is clear.
I currently have over 600,000 followers on Bilibili. I originally promised my fans to continue making videos, but after the bull market came in November last year, I have only updated two videos in the past six months, and they are of poor quality. I have also turned down many dynamic advertisements I used to accept because not updating videos while constantly posting ads is too shameless.
Zhihu continues to write because words have always been my passion, but the frequency of output has decreased significantly.
So I finally understood what Song Fatty said.
I really can't write good songs anymore. Ever since I became famous and made money, I've lost my creative inspiration.
I occasionally learn new things, focusing on outdoor sports to counteract the rising threshold. For example, finding a personal trainer at Luwan Sports Center.
Learning tennis, diving in Suzhou for the second star, indoor skiing in Wuxi, and looking for friends in Shanghai to learn guitar.
I also participate in various miscellaneous activities, treating them like small side quests.
At the beginning of the month, I just attended a blockchain art exhibition in Shanghai, then went to Shanghai Fashion Week, and in a few days, I’m going to Chengdu for a miner's conference, and at the end of the month, I’ll go to Huizhou or Shenzhen to learn surfing.
I applied for a house in the fifth phase of Cuihu Tiandi. I just verified the funds on April 10, but the sales said the pre-sale will be delayed again. Here’s a fun fact: when verifying funds, showing a Bitcoin account is also acceptable.
At first, I indeed had the impulse to buy a supercar. After calming down and considering the depreciation rate, I thought it was better to buy an ordinary GLE350, staying grounded.
I currently have several tens of millions in virtual currency, most of which have been converted to USDT. A portion is ready to buy coins with favorable news or trending coins, and a part is being gradually liquidated.
The mindset has calmed a lot. I gradually have less desire to argue with others and no desire to explain. In fact, along the way, I have experienced too many misunderstandings from acquaintances, and in the end, I feel increasingly lonely.
Additionally, you may have heard many examples of losing money in cryptocurrency affecting real life... I have a completely opposite example:
Initially, a friend helped me make a fortune. His skills were so strong that several old employees of his advertising company followed his advice to invest in coins, and almost all of them made money. He later became reluctant to teach anymore, fearing that once the old employees became financially free, the company wouldn't survive...
After I pass the initial phase of sudden wealth, I expect to feel confused for a while. At that time, I will continue to persist in writing on Zhihu and B.
The success of everyone in this industry must have a certain level of skill. If you rely on luck to earn, it's easy to lose it back. I hope every young person preparing to start trading stocks and cryptocurrencies can understand this.
The value of your life lies in solving problems on the ground and experiencing the world, rather than being arrogant and hollow in a virtual world. No matter what reasons you have, absolutely never go All In.
Investing is just one of the games you experience in life. The success or failure of an investment has little to do with your skills. It depends on your information sources and your luck. To put it bluntly, the old aristocrats oppressed and exploited the commoners, and the new era has just put a layer of noble clothing on the same tricks.
Since I’ve said so much, let me share how I do it.
I have been in the crypto world for a full 10 years now. In the first three years, I lost over 700,000 from a 1 million principal! My whole family was almost on the brink of collapse. I didn’t go out for nearly two months. My husband argued with me every day, threatening divorce. Fortunately, I had the determination back then, believing I could earn it back! In the fourth year, I used the remaining 300,000 to turn things around and started quitting my job to trade in cryptocurrencies!
Later, I vowed to my husband that if I didn’t earn it back, there would be consequences!... After that, I started to invest all my energy, summarizing my previous mistakes and operational errors, observing the thoughts and techniques of those big shots in the crypto world, and eventually, I began to stabilize. Turning losses into profits is truly not easy!
The account has started to turn profitable. Combining short and medium-term operations, it is no longer blindly entering and exiting, but rather planning the account well. A combination of short and medium-term is the best way to compound! With the remaining 300,000, I have achieved over 45.7 million now!
Today, I will focus on sharing the MACD trading strategy that I use the most, the basic usage of MACD, and the top and bottom divergence of MACD.
The divergence of MACD occurs frequently. Using this trading signal in the market has a high accuracy rate, making it one of the more useful technical tools.
However, due to the high accuracy, it can also be exploited by main funds, creating divergence traps. When encountering this situation, more evidence should be added to ensure the accuracy of our judgment.
1. The cooperative judgment of MACD and other indicators
(1) The combination of MACD and moving averages
A top divergence occurs.
At that time, if the moving average has significant support for the stock price's retracement, it indicates that the bullish forces below are relatively strong. Observe if it can easily break through the support level, and one can decisively sell at highs.
When a bottom divergence occurs, the moving average has a significant pressure for upward movement, and it is also a time to take profits at highs. If a breakthrough of the moving average occurs, one can buy again at lows.
Example 1: Using BTC in May 2019 as an example for the 4-hour top divergence, after the 4-hour top divergence, a retracement occurs, and the MA60 received support. The upward trend has not been broken.
Example 2: EOS daily chart at the end of 2018. After the daily line shows bottom divergence, it breaks through the 30-day moving average with increased volume and moves upward. During the retracement, the volume shrinks and there is strong support at the 60-day moving average.
Example 3: Let's compare again. EOS experienced MACD divergence on the daily chart from June to August 2018, but during the rebound, it encountered strong pressure from the upper moving averages, which could not be broken through, and ultimately chose to continue downward.
(2) The combination of MACD and volume
Price, volume, and MACD are the most commonly used set of indicators. CP has volume representing upward momentum, while no volume indicates a decline in upward momentum; all significant rises are pushed by volume, and all significant falls are crushed by volume. Therefore, trading volume is a very important reference indicator.
When a top divergence occurs, the trading volume does not shrink, and funds are still entering. Temporarily wait. If a volume increase occurs during an upward movement, it indicates a peak.
When there is a significant increase in volume and the bulls have signs of selling, it is also important to protect profits. When there is a bottom divergence, if there is no significant change in trading volume, one can hold shares; if there is a sharp decline in volume, panic sellers will flee, and there is still room for decline in the future.
Example 1: Again using BTC in May 2019 as an example for the 4-hour top divergence.
The price reaches new highs, but the MACD indicator does not make new highs. Meanwhile, the trading volume has shrunk compared to the previous round of increases, indicating weakening upward momentum. The cooperative effect with MACD top divergence is a peak signal at the 4-hour level.
Example 2: The EOS daily chart at the end of 2018. The price keeps hitting new lows, but the MACD does not make new lows, and the accompanying volume of the red column is shortening, indicating a weakening downward momentum. The cooperative effect with MACD bottom divergence is a bottoming signal.
(3) The combination of MACD and KD
KDJ is a cyclical indicator that serves as a good reference point for turning points. The downside is that it is too sensitive and prone to false signals. Suitable for short-term indicators.
Example 1: Once again using the 4-hour top divergence of BTC that appeared in May 2019 as a case. The price keeps reaching new highs, but the MACD does not make new highs, and the KDJ is in the overbought zone above 80, and has become stagnant. The cooperative effect with MACD top divergence is a peak signal.
Example 2, EOS daily chart at the end of 2018. The price keeps hitting new lows, but the MACD does not make new lows. The KDJ is in the oversold zone below 10 and is also stagnating. The cooperative effect with MACD bottom divergence is a bottom signal.
(4) The combination of MACD and RSI
RSI is the market strength indicator, indicating the strength of bulls and bears, relatively sensitive. Suitable for short-term indicators.
Example 1: Again using the 4-hour top divergence of BTC that appeared in May 2019. The price continues to reach new highs, but the MACD does not make new highs, and the RSI is above 80 in the overbought zone, and it has not reached new highs, showing top divergence. The cooperative effect with MACD top divergence is a peak signal.
Example 2: EOS daily chart at the end of 2018. The price keeps hitting new lows, but the MACD does not make new lows, and the RSI is below 10 in the oversold zone, and it does not reach new lows, showing bottom divergence. The cooperative effect with MACD bottom divergence is a bottom signal.
Based on the above, multiple indicators can be combined on one chart. The more indicators that diverge simultaneously, the greater the probability of a peak or bottom turning point.
2. The eight common patterns of MACD
(1) Buddha Hand Upwards: After the fast line crosses above the slow line, it moves upwards along with the stock price, and then it follows the stock price retracement downward.
This usually occurs during the main force's washout phase, where the stock price retraces to the vicinity of the MACD line, and then the fast line immediately turns upward, forming an upward Buddha hand pattern.
(2) Little Duck Coming Out of Water: After the fast line generates a golden cross below the zero axis, it does not cross above the zero axis or only crosses slightly before returning below the zero axis, then it dead crosses the slow line, and a few days later, it generates a golden cross with the fast line again.
This pattern is formed when the stock price presents a bottoming shape after falling and testing the bottom, representing a signal for a rebound, which can be a market entry opportunity.
(3) Strolling in the Clouds: The fast line crosses below the slow line at the zero axis and continues to drop below the zero axis, while forming a golden cross with the slow line at or above the zero axis. At this time, the candlestick pattern is often one that has crossed, or is crossing, important moving averages.
This pattern forms when the stock price is consolidating during a rebound after testing the bottom, and it can also be a bottoming pattern, showing an upward momentum. It should be understood as a signal for active involvement, so one should enter the market decisively.
(4) Swan Spreading Wings: The fast line generates a golden cross below the zero axis but then retraces without crossing the zero axis, drawing closer to the fast line. The MACD green bars shorten, but without a dead cross with the slow line, it reverses upwards again, and together with the MACD green bars lengthening, it forms the swan spreading wings pattern.
The formation of this pattern is mostly a bottoming shape, representing a signal for a rebound when the stock price has tested the bottom after falling. It should be understood as the main force's accumulation area, which can be entered opportunistically.
(5) Undersea Cable: The MACD has run above the zero axis for a relatively long time. After the fast line generates a golden cross below the zero axis, the two lines start to merge into one line with equal values. If the two lines once show bullish divergence upwards, one can opportunistically buy.
(6) Fishing for the Moon: When the fast line generates a second golden cross below the zero axis, it indicates that the bottom has been formed, and it begins to rise from the bottom, allowing for opportunistic buying.
(7) Aerial Cable: After the fast line generates a golden cross below the zero axis and runs above the zero axis for a period, when the price adjusts and the fast line F starts to adjust downward, when the fast line approaches the slow line, the two lines merge into one line.
When they separate and a bullish development occurs, that is the time to buy. A new wave of upward momentum is about to begin. This pattern generally presents a strong upward attack shape after experiencing a slight setback during an upward trend.
(8) Aerial Cable Car: The main difference between this pattern and the aerial cable is that the aerial cable does not experience a dead cross, while the aerial cable car will experience a dead cross. A similar point is that all moving averages are in a bullish arrangement.
As shown in the figure, DI crosses below DEA above the zero axis.
The line does not cross below the zero axis first, and a few days later, it crosses above the zero axis again with a golden cross with DEA. This pattern usually indicates that after a brief price adjustment, there is a strong upward momentum, which is a positive signal for entry. If it can continue to expand in volume, it's even more unmissable.
To date, we have introduced what MACD is, how to use divergence to find buying and selling points, the cooperative effects of MACD with four commonly used indicators, and the eight common patterns of MACD.
That’s all I have to say about the MACD indicator. In the future, as everyone learns, there will be further understanding of the application of MACD divergence.
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