Having been in the crypto space for ten years and trading professionally for six years, I have spent over 3100 days. I have engaged in long-term, short-term, ultra-short, and swing trading, utilizing almost all types of methods, so I have a say in this matter.
I always say that mastering a skill is governed by the 10,000-hour rule. With 8 hours a day and over 200 days a year of reviewing, it takes about 5 years, and this is just the foundation for stable profits. There will inevitably be major pitfalls within 10 years, so to be safe, do not invest more than you can afford within that timeframe.
Many experts who have risen from tens of thousands to tens of millions or even billions often do so by using large leverage in contracts. However, many have also perished in a bear market, but you may not know this. Human nature, in the face of a major trend, often leads to a loss of the ability to make correct judgments.
Returning to the main topic, I will now share all my practical tips with you!
From significant losses to significant gains, I have summarized 10 iron rules to give all retail investors a piece of advice!
If you want to stay in the crypto space for the long term, please take the time to read this heartfelt article! Newcomers must remember this to navigate the market with ease. The crypto world is filled with opportunities and risks, especially for newcomers. Learning how to survive and profit in a highly volatile market is a skill that requires continuous learning and practice.
1. In a bull market, the popular coins that fall the fastest are often those that have been hyped up, especially heavily controlled projects, which tend to burst their bubbles quickly. The more a coin attracts retail investors to chase after it, the greater the risk. It's like blowing up a balloon; the bigger it gets, the faster it pops. Popular coins in a bull market are often favored by short-term speculators, but they are also the traps that can lead to total losses. Recommendation: Do not blindly chase after rising prices, especially those that have surged significantly in a short time. Stay calm to avoid becoming a 'bag holder'.
2. The schemes of altcoins are generally similar. The gameplay of altcoins usually involves initially crashing the price to create panic, then slowly raising it to attract retail investors, and finally changing tactics to continue harvesting. This scheme is tried and true, and newcomers can easily get 'cut'. Recommendation: For altcoins, be psychologically prepared; do not be misled by short-term surges, and do not make heavy investments easily.
3. The long-term trend of the market is upward. Although the crypto space experiences short-term volatility, when looking at a longer timeline, the overall trend is upward. The historical performance of mainstream coins like Bitcoin and Ethereum has proven this. Recommendation: If you are a long-term investor, do not be scared by short-term fluctuations; patiently hold quality assets, and time will reward you.
4. Potential coins that no one is speculating on; truly promising coins often remain unnoticed at the bottom and are rarely mentioned. Those that are frantically traded are often tools used by market makers to harvest profits. Low-profile coins may quietly explode at some point. Recommendation: Pay attention to projects that have solid technology and reliable teams but have not yet been heated by the market; they may be the dark horses of the future.
5. Be cautious of newly listed coins on exchanges, especially those that experience wild fluctuations; these are often traps set by market makers. Such coins typically lack actual value support and are purely designed for profit harvesting. Recommendation: For new coins, especially those with huge fluctuations in the early stages, remain vigilant and do not enter lightly.
6. Price fluctuations are commonplace; buying often leads to declines, and selling often leads to rises—this is perfectly normal in the crypto space. The volatility of the market is extremely high, and short-term price changes do not fully reflect a project's value. Recommendation: Maintain a good mindset and do not panic due to short-term fluctuations. Develop your investment strategy and adhere to it strictly.
7. The strongest rebounds do not necessarily represent the coins with the most potential. Often, they are merely speculative plays that have been inflated, lacking fundamental support; they rise quickly and fall just as fast. Recommendation: Do not be misled by short-term surges; truly promising coins typically have more stable fluctuations and an upward long-term trend.
8. Be cautious of sudden pullbacks, as you may get 'scalped'. If the coin you bought rises and then suddenly pulls back, it may signal that the market maker is starting to offload. Market makers often attract retail investors by driving up prices and then selling at high points. Recommendation: In the event of a sudden pullback, promptly take profits or cut losses to avoid becoming a market maker's 'bag holder'.
9. Coins that explode in the second half of a bull market often have mediocre performances in the early stage but can explode several times or more in the latter half. Such coins are like marathon runners, building strength in the early stages and exerting force in the latter stages. Recommendation: Do not overlook those coins that have mediocre early performances but solid fundamentals; they may be the dark horses in the latter stages of a bull market.
10. Coins that have been sideways for months may explode. In a bull market, some coins may experience several times the price increase and then go sideways for months. This sideways action usually indicates that market makers are building strength, waiting for the next explosive opportunity. Recommendation: Keep an eye on coins that have been sideways for a long time; they may be the stars of the next trend.
Summarizing 10 points of experience for your reference, achieving a loss becomes difficult.
Market-maker protected coins:
When the market crashes and the coins you hold do not drop, it is likely the market maker is protecting them. These coins are either fundamentally solid or have potential benefits, so hold steady; the subsequent profit potential is substantial.
Beginner's guide to moving averages:
Newcomers should pay more attention to macro information when buying and selling. For short-term trades, look at the 5-day moving average; if it breaks the line, exit; for medium-term trades, monitor the 20-day moving average and operate similarly. Stick to a simple moving average strategy and act decisively.
Short-term response strategy:
Short-term buying strategy: If you hold for three days without movement, switch immediately. If you buy and it drops, and you lose 5%, decisively cut losses, use funds efficiently, and avoid further losses.
Opportunistic rebounds after sharp declines:
The currency has halved from its high and has been in decline for nine consecutive days. It may have no further downside, and a rebound is imminent. Buy decisively to catch the rebound.
Leading coin investment logic:
In the crypto space, focus on leading coins, as they rise sharply and have strong resilience against declines. Don't hesitate due to high prices or significant drops; buy when an upward trend is established and sell when it reverses.
Balancing bottom fishing and trends:
Don't be obsessed with bottom fishing; a declining coin may have no bottom. Investments should follow the trend, accurately grasp the timing of entry, and there is a higher probability of profit when entering during an upward trend.
Building a trading strategy:
Do not be complacent after a profit in the crypto space; sustained profitability is hard. After every profit, review whether your strategy was effective or just luck, and build a strategy that suits you.
Cash strategy implementation:
When unsure about the market, stay in cash; the safety of funds comes first. Entering the crypto space should be for stable asset appreciation, not for gambling-style investments; trading is about success rates and risk-reward ratios.
Key points for investing in new coins:
New coins may initially see price surges due to market optimism and inflows of capital, but they may lack fundamental support. When market sentiment shifts, funds withdrawing can lead to price collapses, so investments should be cautiously evaluated.
Consensus and wealth in the crypto space:
Digital currencies develop through consensus mechanisms, and participants earn wealth through faith and effort, demonstrating the power of consensus and the potential for wealth creation.
If someone feels confused due to market fluctuations and doesn't know how to handle being 'stuck', or feels misled during their operations, remember to keep learning.
