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On the path of trading cryptocurrencies, I started as a small retail investor with 5,000 and finally transformed into a middle-class individual with 25 million!
Today, I will share my insights from my journey with everyone.
The most important point in trading cryptocurrencies is fund management; don't invest all your money at once. I am used to dividing my funds into five parts and only using one part for each operation. This way, even if I incur losses, I won't be overly burdened. Moreover, I set a rule for myself: if I lose 10%, I withdraw immediately, regardless of the market. If I lose 10% five times in a row, I would only lose 50%, but if I make a profit, the returns would be much more. Even if I end up in a losing position, I can maintain my mindset.
Following the market trend is always the most reliable strategy. When the market is falling, don't think about catching the bottom; that's simply unrealistic. During an uptrend, a pullback is the golden opportunity, and buying low is much safer than stubbornly trying to catch the bottom.
When selecting coins, you need sharp vision. Those coins that have skyrocketed, whether mainstream or altcoins, should be avoided as much as possible. Coins that rise too quickly will also experience large pullbacks, making them more susceptible to being trapped.
In terms of technical indicators, I use MACD the most. When the DIF line and DEA line cross below the zero axis and break through it, that is a buy signal. Conversely, if they cross above the zero axis and start to decline, it’s time to reduce positions.
When it comes to averaging down, never try it lightly! If you incur losses, do not average down; the more you average down, the more you lose, and in the end, you may end up with nothing. Remember, cut losses when losing, and only add to your position when in profit.
Trading volume is also very critical. When the price breaks out from a low level, if the trading volume increases, that's usually a big opportunity.
The most critical point is to go with the trend and seize the trend! Combining the daily, 30-day, 84-day, and 120-day moving averages, when one line starts to turn upward, you will know how to operate.
Trading cryptocurrencies carries risks, but there are also significant opportunities.
Learn to manage funds, analyze trends, and select coins, so that you can rise from a small retail investor to a middle-class individual like me.
8 golden rules summarized from 10 years of trading cryptocurrencies | Easy for beginners to understand investment discipline:
Having floated in the crypto world for 10 years, from liquidation to stable profits, I’ve summarized these practical experiences to help beginners avoid pitfalls. This article is devoid of fluff, only pure solid information! (Including an operation checklist)
1⃣ [Spare money investment principles | Use funds that won't affect your lifestyle to enter the market]
Always use only 10%-20% of disposable funds for trading; for example, if your savings are 100,000, at most take 20,000 to enter the market. I've seen too many people risk their entire fortune or even borrow money, only to have their mindset collapse in the end. The true winners are in a 'can afford to lose' state. For example, with Bitcoin dollar-cost averaging: buying in batches with 10% of your monthly salary, even if the bear market drops by 50%, it won't affect your quality of life.
2⃣ [Stop-loss is more important than profit | 5% mandatory stop-loss line]
When the direction is wrong, a loss of 5% must be immediately stopped out. I once held a position during the LUNA crash, watching 100,000 turn into 1,000. Now my discipline is: exit short positions when the short-term price breaks the 5-day moving average, and liquidate positions when it breaks the 20-day moving average. Remember: staying alive means having a chance to turn things around.
3⃣ [Position management pyramid | Never be fully invested]
Dividing capital into three parts:
❶ 30% mainstream coins (BTC/ETH) for long-term holding
❷ 50% swing trading (based on the 15-minute KDJ indicator for entry and exit) 1
❸ 20% reserved as a margin for averaging down
When encountering a crash, average down in three steps at -15%, -30%, -50%.
4⃣ [Technical indicator combo | Three charts determine the outcome]
❶ 15-minute candlestick chart to observe short-term trends 1
❷ Daily MACD to determine bullish or bearish direction
❸ Weekly Bollinger Bands to identify support and resistance levels
When these three appear with 'golden cross + mid-line support + increased volume' resonance, it is the best entry signal 5.
5⃣ [News operation guide | Positive news turns negative immediately]
On the day of a major positive news release, if you haven't sold, you must sell on the second day when it opens high. When the Bitcoin ETF passes in 2024, many people got trapped buying at the high point of 69,000. Remember: when the media starts to celebrate, it's often the point at which the big players are offloading.) 6
Appendix: My personal tool list
• Market analysis: TradingView (most comprehensive charting tools)
• Information: Jinshi Data (real-time monitoring of macro policies)
• On-chain data: Glassnode (tracking whale addresses)
• Scam prevention guide: TokenSniffer (to identify scam coins)
Lastly, I want to say: there is no holy grail in the crypto world; these experiences are earned with real money. At first, it may feel restrictive, but once you form muscle memory, you will understand—discipline is the prerequisite for freedom. Let's encourage each other!
What is the logic behind making money in the crypto world?
The logic of making money in the crypto world is legal robbery.
In the crypto world, one can earn 50,000, 100,000, 200,000, or even a million in a single day; this is a reality and the probability is far higher than in other traditional markets.
For example, I mentioned: Dogecoin in 2021, TRB in 2023, People in 2024.
No matter what you did before, what background you have, or how much capital you have, everyone has equal opportunity in front of Bitcoin! This has been true since its birth!
My experience is that if you want to make money in the crypto world, you must consider the following points:
1. Cognitive disparity
2. Information disparity:
3. Execution issues:
These three are fundamental, and they can stack together, combining cognitive differences with execution differences, and information differences with execution differences, etc.
This model also determines that its trading behavior has high returns, low risks, and strong sustainability. This is also the most stable and publicized money-making model I have seen in the crypto world over the years.
However, for the vast majority of ordinary people, aside from the luck of the chosen ones, it is possible to achieve small capital gains in the short term.
There are basically a few types of 10x opportunities:
Less fantasy, more effort; for the vast majority of people, this is the optimal solution in life.
If you don't have much money and think you can get rich by just clicking the mouse, that's not reliable for most people; for example, if you are a computer science student, if you solidify your programming skills, graduating and finding a job with a salary of 300,000 is relatively not difficult, isn't it better than jumping around for a few thousand every day?
Work hard to learn, develop outstanding skills, and find a good job; in reality, achieving a sense of accomplishment may lead to giving up gambling, and making money may even be faster, leading to a more solid life path.
Can short-term trading in digital currencies be profitable?
Many people say that short-term trading in cryptocurrencies does not make money. In fact, this is mainly because short-term trading requires a certain amount of time to monitor and a lot of review work. Additionally, in the crypto space, it's a two-way trading fee model, meaning that both buying and selling incur fees. In this case, we need to consider the costs incurred before calculating returns on our trades.
Moreover, in short-term trading, if you misjudge the market, it can easily turn your short-term trades into medium- to long-term ones, even turning into a belief. The vast majority of people do not have systematic trading habits and find it hard to strictly adhere to their own habits, withdrawing returns immediately. Not so! When trading short, there are two ways to ensure we can exit unscathed.
a. We need to use trading bots for trading, executing automatically 24/7.
b. This means setting strict buy and sell principles for yourself: immediately sell when profits reach 30%, and buy when it drops by 30%. Manual operation, strict execution; as long as you follow trading rules, you basically won't find yourself in a passive or trapped situation. Of course, this applies to both spot and contract trading; whether swing trading or contract trading, strict execution and establishing a personal trading system are essential.
Tips for short-term trading in digital currencies:
1. Do not enter trades with any subjective or artificially influenced directional sense. Each entry must have a 'pre-set' stop-loss point or stop-loss condition. When entering or exiting, do not focus on profit or loss or the highs and lows of the price. For 'ultra-short' trades, only choose the 'hottest varieties' that have the largest trading volume and increasing open interest, leading the rise or fall. Any varieties without significant trading volume should not be considered or traded.
2. For 'ultra-short' trading, only look at instant charts, 1 or 3-minute charts, bid and ask prices, trading volume, and order flow (do not look at any other technical indicators, and do not consider price levels).
3. The moving average parameters for the instant chart are; for 1 or 3-minute charts, the moving average parameters are 5 or 55, 113, and the volume line is 5, 34. Additionally, adjustments can be made based on different varieties.
4. Look at the instant chart to grasp the current trend of the day:
(1) When the average price line (yellow) is sloping upward, and the price line (white) is above the average price line, with each wave moving higher, it indicates a current uptrend, and we will primarily go long (only consider going short when the price line is too far from the average price line, or give up the opportunity to short in an uptrend).
(2) When the average price line is sloping downward, and the price line is below the average price line, with each wave moving lower, it indicates a current downward trend, and we will primarily short (only consider going long when the price line is too far from the average price line).
(3) When the average price line is horizontal, and the price line crosses back and forth over the average price line, it indicates a current consolidation or oscillation; do not enter the market, or trade both long and short.
(4) When you see the price line crossing above the average price line, go long (or liquidate the short position); when crossing below the average price line, go short (or liquidate the long position). At the moment of 'crossing', it's best to have a combination of 1 or 3-minute charts, order flow, and trading volume.
5. Specific entry and exit points depend on the 1 or 3-minute charts and the order flow:
(1) When the instant chart shows an 'uptrend', be patient and wait for the 1 or 3-minute chart to show 'the previous candle is a bearish K line, flipping to the next candle just turned into a bullish K line' or 'the bearish turns to bullish while the 3 moving averages turn upward', decisively enter and go long. At this time, sell orders are continuously eaten up by buy orders; even if there are downward sell orders, they won't be significant or sustained.
(2) When the instant chart shows a 'downward trend', (going short is exactly the opposite of going long, I won't elaborate here).
(3) Liquidate long positions; if you entered the market when the first 3-minute bearish K line turned into a bullish K line, prepare the liquidation order immediately. The timing for liquidation is: liquidate as long as there is profit, or if the rises of the bullish K lines become smaller, or if there are long upper shadows, or if there have been two consecutive 3-minute bullish K lines, or if sell orders suddenly increase above, or if there are large sell orders eating down orders while buy orders decrease, or if the 3-minute K line has just turned from bullish to bearish, or if it turns from bullish to bearish and the 3 moving averages turn downward. At this point, you should decisively liquidate your long positions.
(4) Liquidating short positions (exactly the opposite of liquidating long positions).
(5) When the instant chart shows a 'consolidation trend', as long as you see a bearish turn to bullish on the 3-minute chart, and the 3 moving averages turn upward, go long; if you see a bullish turn to bearish, and the 3 moving averages turn downward, go short.
Follow Su Ge closely, analyze with precise strategies, and select with huge capital using AI big data to keep yourself undefeated? The market never lacks opportunities; the question is whether you can seize them. By following experienced people and the right ones, we can earn more!
