Some people lose everything overnight, while others achieve social mobility. As an 'old hand' who has been in the cryptocurrency space for a decade, I was once a 'seasoned retail investor' who frequently faced liquidation, living in debt with even my breath tinged with despair. The true turning point that changed my fate occurred five years ago on a night that transformed my understanding—a wise saying from an elder, like a beam of light, illuminated my path in the darkness. Looking back now, I have finally deciphered the ultimate code for survival in the cryptocurrency world and recognized the eight stages of growth that retail investors inevitably undergo from ignorance to maturity.
If you are about to step into the cryptocurrency world or feel lost in the whirlpool of price fluctuations, I hope my ten years of blood and tears can serve as a 'pitfall guide' to help you avoid detours. In this market full of temptations and traps, if you want to achieve a turnaround, 'rolling positions' may be the sharpest yet most dangerous weapon. Next, I will share my practical experiences without reservation, revealing the truths behind the wealth code.
1. The 'golden triangle' timing for rolling positions: Understand the trend to seize opportunities.
Many beginners feel anxious when they hear 'rolling positions', thinking it's a gambler's crazy operation, but its essence is merely 'adding to floating profits'. In futures trading, this is a very conventional technique. The key lies in how to precisely capture suitable moments for rolling positions in a tumultuous market. Through countless practical validations, I have concluded that only three situations are worth the risk:
The directional choice of volatility hitting the bottom: When the market falls into a long period of consolidation, price fluctuations become stagnant, and trading volume remains low. This 'calm before the storm' often conceals turning points; once the price breaks out of the consolidation range, whether upward or downward, it is an excellent opportunity for rolling positions—just like waiting for a big fish to leap out of a calm lake; once the moment comes, you must strike decisively.
The moment to bottom out during a bull market correction: A true bull market never rises in a straight line; rather, a deep correction after a big increase gives rise to opportunities. When the market experiences a 'golden pit' due to panic selling, and your fundamental or technical analysis indicates that the trend has not changed, decisively enter the market to roll over your positions. This not only helps to average down costs but also maximizes profits when the market reverses.
Key breakthroughs on the weekly chart: The weekly chart serves as a 'barometer' for medium to long-term market trends. When prices break through or fall below significant resistance or support levels on the weekly chart, it indicates a confirmation of the trend. Following up with rolling positions at this point is like getting on a high-speed train to wealth; as long as the trend does not reverse, the compounding effect will bring unimaginable returns.
My definition of rolling positions is: in a clear trending market, using leverage to profit, and due to the increase in position value leading to a passive decrease in leverage, to continuously amplify returns by adding trend positions at key nodes. This 'key node' often lies in the moment of breakthrough following trend convergence or the pullback low points of moving average support. For example, after a converging triangle formation, immediately add to positions when the price breaks upwards; once the main upward wave accelerates, quickly reduce positions to lock in profits; or when the price stabilizes at the 20-day moving average during a pullback, accumulate in batches, waiting for the next upward cycle.
2. The paradox of risk in rolling positions: The danger is not in the strategy, but in human nature.
Whenever I share rolling position strategies, there are always those who shake their heads: 'This is too aggressive, the risks are too high!' But in my view, the real danger has never been the rolling positions themselves, but the uncontrolled leverage and greedy human nature. Taking a capital of 50,000 yuan as an example, how to use rolling positions to achieve a turnaround? The key lies in 'using profits to seek opportunities, controlling risks with rules':
Assuming Bitcoin opens at 10,000 dollars, using 10x leverage, but only using 10% of the position (i.e., 5,000 yuan margin), the actual leverage is only 1 time, with a 2% stop loss set. Even if I misjudge, the maximum loss would only be 1,000 yuan. If the price rises to 11,000 dollars as expected, continue to increase the position by 10% of total funds, also setting a 2% stop loss. This cycle continues; if I capture 50% of the market, the final profit could reach 200,000 yuan—two such opportunities could achieve the million target.
I always adhere to three principles: First, only use one-fifth of total funds to participate in cryptocurrency investments, with futures capital not exceeding one-tenth of spot capital; second, control leverage at 2-3 times to avoid the catastrophic risks of high leverage; third, only choose mainstream coins like Bitcoin that have strong liquidity and high risk resistance. With this combination, even if I lose 20,000 yuan out of a million yuan principal, it is still within an acceptable range. Remember, rolling positions is not gambling; it is a carefully calculated probability game.
3. The iron law of trading: The survival philosophy of 'Don't make small profits, and don't incur large losses.'
After ten years of struggling in the cryptocurrency world, I have seen too many people vacillate between 'taking profits and cutting losses', ultimately losing their way. Some are pleased with a 5% gain, only to miss out on a 50% main upward wave; others stubbornly hold onto losses, turning floating losses into actual losses. The essence of trading is to find a balance between 'greed' and 'fear'.
"Don't make small profits, and don't incur large losses"—these eight words may seem simple, but they represent the most difficult trading philosophy to practice. The market will not offer you opportunities for 'all or nothing'; you must learn to make trade-offs. I choose to give up small fluctuations and focus on capturing major trends—although this may mean missing some short-term opportunities, it also avoids the risks and fees associated with frequent trading. Of course, this does not require 100% execution; trading is inherently a game of probabilities. What we need to do is continuously enhance the execution of our rules, tilting the probability of profit in our favor.
The cultivation of rolling position traders: Overcoming human nature is the ultimate weapon.
The threshold for rolling position strategies lies not in technical analysis, but in the cultivation of mindset. It acts like a mirror that exposes the weaknesses of human nature:
The test of patience: Can you endure the loneliness and wait for trading opportunities that meet the criteria? Not feeling anxious while being out of the market, and not entering blindly before the market starts.
The restraint of greed: When your holding profits double, do you have the courage to give up part of your floating profit and continue holding for greater potential? Or are you eager to secure profits and miss the main upward wave?
Overcoming fear: After opening a position, if the price moves against you, can you stick to your stop-loss discipline? Do you have the courage to decisively increase your position after the trend is confirmed?
The anxiety of missing out, the worries during profitable times, the self-doubt after losses... These mental demons require years, even decades, of trading experience to overcome. Remember, even if you master rolling position techniques, it only increases the probability of making money, not guaranteeing 100% success. Trading is a form of cultivation; only by continuously refining one’s mindset and strictly adhering to rules can one emerge victorious in the cruel game of the cryptocurrency market.
After ten years in the cryptocurrency space, I have seen too many fleeting myths of wealth and witnessed countless people exit in disappointment. The true winners do not rely on luck to make a couple of right calls; they understand the essence of the market and overcome human weaknesses. I hope my experience can help you avoid ten years of detours. But please remember: no strategy can guarantee profits without loss; all trading must be built on a foundation of controllable risk. In this tempting market, surviving is the only qualification to discuss the future.
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