The cryptocurrency market is highly volatile with many opportunities but extreme risks. Mastering some practical skills can help you participate more rationally. Here are some key recommendations:
1. Basic Principles
1. DYOR (Do Your Own Research)
- Never blindly follow big influencers, community news, or 'insider' information. Research each project’s white paper, team, technology roadmap, and community activity on your own.
- Common tools: CoinMarketCap (data), CoinGecko (analysis), GitHub (code updates), Twitter/Discord (community sentiment).
2. Position Management
- Never go all-in: Keep any single cryptocurrency position to no more than 10%-20% of your total portfolio to avoid the risk of losing everything.
- Buy and sell in batches: Dollar-cost averaging (DCA) is suitable for long-term holdings, and buy in batches during price drops.
3. Only invest money you can afford to lose
- In extreme market conditions, your principal may evaporate instantly, so be sure to participate with spare money.
2. Trading Skills
1. Introduction to Technical Analysis
- Key Indicators:
- Support/Resistance Levels (historical price dense areas)
- Moving Averages (MA50, MA200 to determine trends)
- RSI (overbought/oversold; be cautious of pullbacks above 70, possible rebounds below 30)
2. Trend Judgment
- 'In a bull market, don’t speak of tops; in a bear market, don’t speak of bottoms': Go with the trend, not against it.
- Bitcoin dominates the market (BTC.D indicator): When BTC crashes, altcoins usually fall harder.
3. Stop Loss and Take Profit
- Set predetermined stop losses (e.g., sell automatically at -10%) to avoid emotional holding.
- Laddered take profit: Sell in batches during price increases (e.g., sell 20% at +50%, 30% at +100%).
3. Pitfall Prevention Guide
1. Identify Scams
- Pump and Dump: Sudden price surges + 'FOMO' calls in the community are often traps.
- Fake Wallets/Phishing Links: Always manually input the official website, do not click on unfamiliar links.
2. Secure Storage
- Hot wallets (MetaMask, Trust Wallet) should only hold short-term trading funds.
- Cold wallets (Ledger/Trezor) for storing large assets, with mnemonic phrases saved offline.
- Be wary of 'token authorization permissions': Regularly check for malicious authorizations on Revoke.cash.
4. Information Channels
1. Real-time Data
- Glassnode (on-chain data), Santiment (sentiment analysis), DeFiLlama (DeFi data).
2. Airdrops and Opportunities
- Participate in early testnet activities of quality projects (e.g., Starknet, zkSync, and other Layer 2 projects).
5. Mindset Control
1. Don't chase highs and sell lows
- FOMO (Fear of Missing Out) is a primary cause of losses; be cautious when chasing after price spikes.
2. Accept Imperfect Trades
- Selling at the wrong time or missing out is normal; no one can capture all profits.
3. Bear Market Strategy
- Making money in a bull market relies on luck; consistent investments (e.g., BTC/ETH) in a bear market are the real opportunities.
6. Advanced Strategies
1. Contract Trading
- For experienced traders only; leverage should not exceed 5x to avoid liquidation from high volatility.
2. Arbitrage Opportunities
- Exchange price differences, stablecoin interest rate differences (e.g., CEX vs DeFi lending).
Final Reminder
In the cryptocurrency world, one day is like a year in the stock market: high returns come with high risks; continuous learning is more important than blind trading.
Invest rationally; survival is more important than getting rich quickly.
Ling Mo, who has been in the cryptocurrency space for 9 years, welcomes you to like and follow to explore the crypto world together!
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