If you plan to invest in cryptocurrencies, please take a few minutes to read my answer, as it may save your life and your family. Thousands of originally happy families end up devastated because they pursued the unattainable dream of making a fortune in cryptocurrency. I believe that the reason I can continue on this trading path is that I have always been dedicated to learning, understanding the basic knowledge, analyzing news, studying technical indicators, and forming a self-stable profit trading system!
1. Don't let floating profits turn into losses. Once there is a floating profit of more than three points, set a protective stop-loss near the opening price; never lose your principal. In the cryptocurrency world, gaining more than three points is easy, especially for small altcoins. At this time, you can slightly raise your take-profit level, possibly using a trailing stop to protect your profits. Especially in a bear market, taking profits regularly is essential to protect your gains. Normal people can't handle the transition from floating profit, initially happy and already thinking about what to do with the money, to floating losses. The feeling of going from heaven to hell is unbearable for those with weak minds; emotions can easily influence your decision-making and lead to foolish choices. By the time you wake up, your account's funds may have also diminished, and regrets will come too late.
2. Don't let small gains turn into large losses! Embrace the trend and go with the flow. The buying price is not better when lower, but rather when it is suitable. You won't gain an advantage just because the buying price is cheap, as falling prices don't signal a bottom. Abandon junk coins; the trend is king.
3. In speculative markets, being reactive is the most incorrect approach. Use a fixed trading system, and let your system remain unchanged amidst changes. It’s not about using a thousand methods; it’s about using one method a thousand times. Inaction is the best defense; often, the times you are most reluctant to let go are when you make the most mistakes. Reflect on this!
4. Patience is the foundation of making money. You may need to learn for a long time and be deceived countless times before understanding the situation in the cryptocurrency world. It's okay; cherish every experience of being deceived, as these are lessons on the investment journey.
5. When the price of a coin enters a stable upward channel, each pullback is a temporary stop, a good opportunity for us to get in. There are no coins that only rise; pullbacks are like compressed springs, preparing to jump higher. 6. Humanly judged bottoms are usually not true bottoms but halfway up the mountain. The real formation of a bottom depends on emotions and capital, so never blindly try to catch a falling knife; often, 9 out of 10 will get trapped.
7. When in profit, close the position once your psychological target is reached; don't aim to maximize every gain. Also, pay attention to position size and leverage control; learn to strictly manage your position based on the leverage of the products you trade combined with your own capital.
8. Utilize moving averages: Short-term operations generally refer to the 5-day, 10-day, and 20-day moving averages. When the 5-day moving average crosses above the 10-day and 20-day moving averages, and the 10-day crosses above the 20-day, it’s called a golden cross, indicating a buying opportunity. Conversely, when it crosses down, it’s a death cross, signaling a selling opportunity.
9. The mindset for trading cryptocurrencies is crucial. Even with millions, one can still lose everything. Trading cryptocurrencies is all about mentality; it is a psychological game among millions, a fierce psychological battle.
10. Finally, always learn more about cryptocurrency investment knowledge, enrich yourself, and summarize daily. As the saying goes, practice is the only criterion for testing truth. Only through a lot of real trading can you truly consider yourself a beginner in cryptocurrency trading.
