After 10 years of trading in cryptocurrencies, I made a profit of 58 million from 700,000 yuan when I entered the market. I only used 5 layers of warehouses. With this method alone, I could achieve a monthly return of 70%. I shared the essence of this with my apprentice, and he became very skilled in the operation. He doubled his return in 3 months by using this method to trade in the short term.
Today I specially sorted it out and shared it with the destined people, and keep it well. Everyone comes to the cryptocurrency circle with the same original intention, there is no doubt about this. If you just want to have fun and kill time, then this is not the place for you. We come to the cryptocurrency circle to make more money and make our families live better. If technology is the prerequisite for profit in the cryptocurrency circle, then the iron law that needs to be strictly adhered to is the key to long-term profit.
If you want to use cryptocurrency trading as a second source of income, want to get a piece of the cryptocurrency circle, and are willing to spend time to grow and learn, then don’t miss this article. Read it carefully, and every point is the essence of the cryptocurrency circle. It can be said that whether it is a bull market or a bear market,
Cryptocurrency trading is not as simple as you think. It is not about making huge amounts of money by just buying and selling. A qualified cryptocurrency trader must follow news hotspots, pay attention to the international situation, study the fundamentals and technical aspects of virtual currencies, and have a big heart, able to withstand ups and downs, from nothing to something, from something to nothing, and able to withstand temptation. Those who survive the cryptocurrency circle are basically indomitable, immune to all poisons, and tempered into steel.
Three principles of gold mining:
Principle 1: Strictly control the position of 50% when building a position, so that you can defend when retreating and attack when advancing. Don't hold a full position at any time. Once the position falls sharply, even the gods can't save you.
Principle 2: Once the price has increased by 2-3 times, we must sell half of it first. After we get back our investment, we will use the profit to play with the dealer slowly, and then sell it slowly when it reaches our own price. We keep 10% of the bottom position to avoid missing out on the benefits given by the powerful dealer's sudden pull.
Principle three: When the market is crazy and everyone is chasing the rise, you must sell your chips slowly in stages and batches. Don't be superstitious about the numbers in your account. Only the money in your pocket is yours. The platform account is just a string of numbers.
Three secrets for cryptocurrency trading!
Tip 1: Don't put big money in the small and informal websites for speculating in cryptocurrencies. Other websites are gone. Go to formal and large websites, such as Binance. Tip 2: There are so many crowdfunding coins recently. Please keep your eyes open. It's not that you can't invest in all of them, but there are many pitfalls. Be cautious and don't try your luck. Understand it clearly. Don't invest in crowdfunding just because it comes out. That's like gambling and trying your luck.
Tip 3: The cryptocurrency market has been sluggish recently, and the overall market is cooling down. Short-term operations are mainly based on waiting and watching, and you can start when you see the opportunity. For long-term investment, you can choose the top 20 high-quality coins in the world, and you can build positions in batches at low prices. (Remember, don't go all in, that is, don't buy a lot of coins at once and invest too much money. You can start with a half position, buy half of the coins, control the risk and funds, and then when the price rises or falls, you can make up for the position in time and stop the loss. This will be more conducive to making money. If you don't make up for the position in time, you can minimize the loss. Speculating in cryptocurrencies is to make money, so you must be prepared to avoid unnecessary losses.)
Finally: the most important point is not to follow the trend.
Without further ado!
Share my trading strategies and experience with friends. There is a saying that standing on the shoulders of giants will save you ten years of hard work.
Friends who want to improve their cryptocurrency trading skills must read more and study carefully. It is recommended to collect it!
Have you ever wondered how traders can accurately determine when a chart begins to trend? Experienced traders often use specific indicators to help predict market trends. When it comes to trend prediction, the two most important indicators are the golden cross and the death cross.
In this guide, you will learn the following:
(1) Definition of golden cross and death cross.
(2) Why using the 50-day and 200-day moving averages is important.
(3) Use auxiliary indicators.
(4) Real trading setup and examples.
(5) Recognize the limitations of the golden cross and death cross
2. What are the Golden Cross and the Death Cross?
First, there are some differences between the golden cross and the death cross. A golden cross occurs when a short-term moving average crosses above a long-term moving average, and is often seen as a signal of a potential bullish market trend.
This crossover often occurs at the bottom of a downtrend and indicates that the market's short-term momentum is outstripping its long-term momentum, signaling the start of an uptrend. Typically, traders look for the 50-day moving average to cross above the 200-day moving average, which is seen as a strong bullish sign, as shown in the chart below.
USD/JPY Daily Chart Golden Cross
This chart is a classic example of a golden cross, and looking at what happened afterwards, the price continued its upward momentum, marking the beginning of a new uptrend.
So, what about the death cross? What it expresses is that the uptrend may be coming to an end. In contrast to the golden cross, the death cross appears at the top of an uptrend. This happens when the short-term moving average is below the long-term moving average. This is often seen as a potential bearish trend signal. This crossover indicates that the market's short-term momentum is weaker than its long-term momentum, suggesting that a downtrend may be imminent, as shown in the figure below.
USD/CAD daily chart death cross
Similar to the Golden Cross, the 50-day and 200-day moving averages are used to identify the Death Cross. These two patterns are widely adopted because they produce clear signals and provide a broad perspective on market trends. They provide an easy-to-understand method to determine whether the market is in an uptrend or a downtrend.
3. Different moving averages
(1) 50-day and 200-day moving averages
In technical analysis, moving averages are an important tool for evaluating price trends in financial assets such as stocks, commodities or currencies. I am often asked why I choose 50-day and 200-day moving averages instead of 20-day and 100-day, or 5-day and 20-day. The answer is that 50-day and 200-day moving averages are effective in capturing short-term and long-term trend momentum.
When the 50-day and 200-day moving averages cross over the time frame, they form what are known as golden crosses and death crosses, which are considered important trend signals that help traders identify potential buying or selling opportunities. A golden cross usually occurs when a short-term moving average crosses over a long-term moving average from below, signaling a potential uptrend. Conversely, a death cross occurs when a short-term moving average crosses over a long-term moving average from above, and may signal the end of an uptrend.
The 50-day and 200-day moving averages were chosen to strike a balance between sensitivity and reliability. Such a combination can create a large number of trading opportunities while helping traders track changes in market momentum and make more favorable trading decisions.
(2) Moving averages of different time frames
The good news for those who do not trade using the daily timeframe is that these moving averages can be adjusted on any timeframe. For example, using the 50-day and 200-day moving averages on the 1-hour timeframe will produce more frequent trading opportunities. However, it is important to note that more frequent trading opportunities do not necessarily mean higher quality trades, as lower timeframe settings are often less weighted and valued than higher timeframe settings.
Traders should keep this in mind when considering using the Golden Cross and Death Cross on different time frames. Additionally, these indicators do not have to be used alone and can be combined with other tools and techniques to increase the efficiency and effectiveness of a trading strategy.
4. Use supplementary indicators
(1) Relative Strength Index (RSI)
The Relative Strength Index (RSI) is a momentum oscillator that measures the speed and magnitude of price changes. The index ranges from 0 to 100 and is often used by investors to determine overbought or oversold conditions in the market. When the RSI value exceeds 70, it often indicates that the relevant security may have entered the overbought area; conversely, if the RSI value falls below 30, it may indicate that the security is already in the oversold area. When combined with the technical analysis techniques of the golden cross and the death cross, the RSI can provide investors with auxiliary signals for trend strength confirmation, as shown in the figure below.
AUD/NZD Daily Chart RSI Example
In the above figure, we can observe that the moving averages have crossed, forming the so-called "golden cross". If we look down at the relative strength index (RSI) along the golden cross point, we can clearly see that the RSI value is above the 50 level, which further verifies that the market momentum is leaning towards buyers, thus providing additional confirmation for the golden cross signal. However, this is not the only tool that can provide auxiliary analysis. Next, this article will explore the performance of the moving average convergence divergence (MACD) indicator.
(2) Moving Average Convergence Divergence (MACD)
Moving Average Convergence Divergence (MACD) is a widely used momentum indicator that reveals the interaction between two moving averages corresponding to security prices. It should be noted that the MACD is calculated by subtracting the 26-period exponential moving average (EMA) value from the 12-period EMA value, and the difference is the so-called MACD line.
Furthermore, the 9-day EMA of the MACD line (often called the "signal line") is superimposed on the MACD line, and the crossover of this line can be seen as a trigger for a buy or sell signal. Traders often watch for crossovers between the MACD line and the signal line, as well as their divergence from price action, as further confirmation of the trend identified through the golden cross and death cross, as shown in the figure below.
AUD/NZD Daily Chart MACD Crossover
In the above figure, we can observe a series of bar charts after the golden cross, among which the MACD indicator also shows a crossover phenomenon, which clearly indicates that the market momentum is clearly leaning towards the bulls.
So far, you have learned a lot about how to identify the golden cross and death cross. However, profit realization and transaction management after entering the market are also crucial links in the trading process. Next, this article will analyze some actual trading cases to explore the application of these strategies in more depth.
5. Death Cross Example
(1) Example 1
CAD/CHF daily chart death cross
In the current daily chart of the Canadian Dollar/Swiss Franc (CAD/CHF), the price action has shown a trend of forming lower short-term highs and lower short-term lows, and the moving averages have also crossed, forming the so-called "death cross". Nevertheless, even after the death cross, the trading strategy still recommends caution and wait for the price to be rejected at the current level and present a bearish candlestick pattern as a further confirmation of the market downside. Next, we will look for a candlestick pattern that can clearly indicate the market's bearish rejection, as shown in the figure below.
CAD/CHF Daily Chart Death Cross Entry
Looking at the chart, we can see that the price has broken below the moving average and appears to be forming a series of lower short-term highs. Regarding the placement of the stop loss, it should depend on the trader's risk tolerance, and for this example, we would prudently place the stop loss above the previous high. In this trading scenario, if the moving averages cross again, this is often seen as a signal to exit the trade as it may indicate that the established downtrend has come to an end, as shown in the figure below.
CAD/CHF Daily Chart Death Cross Trading Management
Please note that the price action is currently showing signs of forming higher short-term lows and is attempting to break through the previous highs, however, it is worth noting that the moving average crossover signal has not yet occurred, so in this case, we should maintain our current trading stance and continue to observe market dynamics to determine possible subsequent developments, as shown in the figure below.
CAD/CHF daily chart death cross take profit
The price continues to follow the downward trend indicated by the death cross, and after the crossover phenomenon reappears, you have successfully achieved a considerable profit. It is worth noting that there are many factors in the trading process that may complicate operations and prompt traders to close trades prematurely. Clearly identifying which factors may lead to early exit from a trade, or determining which conditions meet your profit expectations, is a key part of the trading strategy. Next, let's explore this topic further through another example.
(2) Example 2
GBP/CHF daily chart death cross
In this example, initially, the price showed an upward trend, but soon after, the price trend turned to sideways consolidation, and the original upward momentum gradually diminished. This phenomenon may indicate that the price trend is turning from rising to falling. Based on this, we may consider trading operations, and we should make trading decisions after clearly observing that the price has a rejection reaction to this area, as shown in the figure below.
GBP/CHF Daily Chart Death Cross Entry
Since the value area has clearly shown a rejection trend, now is the best time to start the transaction. In this transaction, it is recommended to set the stop loss point above the previous high. You may ask: In this transaction, when is the right time to exit the market? In response to this question, we can use the moving average as a reference indicator to determine whether to continue holding the transaction. Specifically, if the closing price rises above the 200-day moving average (represented by the black line), it can be used as a basis for triggering a take-profit signal. Based on this, we can formulate corresponding exit plans for different operation strategies, as shown in the figure below.
GBP/CHF Daily Chart Death Cross Trading Management
Looking at the price trend, we can see that it has started to show a downward trend, and so far, the closing price has not touched above the 200-day moving average (200 MA). On the contrary, the price seems to regard the 200-day moving average as resistance and continues to reject it. In this case, we should continue to maintain the current transaction and observe the subsequent development of the market, as shown in the figure below.
GBP/CHF Daily Chart Death Cross Take Profit
This trading example shows how moving averages can be used as an important resistance indicator when identifying potential profit taking. Next, let's look at the last example.
(3) Example 3
GBP/CAD Daily Chart Death Cross
Here we have witnessed the formation of another Death Cross pattern. In this example, we would have placed our stop loss above the previous high, and I understand that you might be expecting a similar outcome to the previous example where the price action would continue to translate into profits, however, take a closer look as shown in the chart below.
GBP/CAD daily chart: Death cross stop hit
Did the stop get hit? This was not the expected outcome and obviously the Death Cross pattern does not always go as we expect, however, there are some positive signs and early indications that this trade may not play out exactly as initially expected, as shown below.
GBP/CAD Daily Chart Crossover
Observe how the price quickly pulled back after the stop loss was triggered. Now, let's review the price data before the transaction and explore in depth: Is this trading decision reasonable? As shown in the figure below.
GBP/CAD daily chart range
Notice how the market has remained in a wide trading range for quite some time, and the recent Death Cross pattern has similarities to a number of previous Golden Cross and Death Cross patterns. Therefore, this is a cautious reminder of the importance of looking at the entire market context. Death Cross trading strategies are not appropriate in a range-bound market environment, unlike the brief sideways phase that prices experience after an uptrend, which in this case shows prices remaining in a wide range for about a year. Now, let's turn to some examples of Golden Cross patterns.
6. Golden Cross Example
(1) Example 1
NZD/JPY daily chart golden cross
Here, we observe a solid daily golden cross pattern, but there is a problem. If investors intend to enter the market at this intersection, the required stop loss position will have to be set far away from the entry point, which makes it difficult to achieve significant profits. Therefore, in this case, the most reasonable strategy is to wait for the market to pull back. Next, let's observe the subsequent development of the market, as shown in the figure below.
NZD/JPY daily chart golden cross entry
The price has now re-touched the moving average, which makes our stop loss and entry point more reasonable. Now, let's look at how this trade progressed, as shown in the figure below.
NZD/JPY Daily Chart: Golden Cross Potential Exit
This raises a question: should investors exit the trade when the price breaks through the 200-day moving average, or should they wait for a crossover signaling the end of the uptrend? In fact, there is no absolute right or wrong answer on this point. Let's analyze each case one by one, as shown in the figure below.
NZD/JPY Daily Chart Golden Cross Trading Management
As the price action continues, the moving averages are getting closer to the crossover point, however, the actual crossover has not occurred. Therefore, we should maintain the current trade and continue to hold the position, as shown in the figure below.
NZD/JPY Daily Chart Golden Cross Exit
Eventually, the moving averages complete a recross. You might think it would be worth waiting for a crossover signal rather than exiting the trade early, however, as the chart shows, the price gap between the two potential exit points, and therefore the profits, is relatively small. You might want to consider whether taking profits early would be a better strategy, as mentioned before, there is no right or wrong approach to either strategy, but how you approach the trade will depend on your personal risk tolerance and how you think price will align with the moving averages or specific areas on the chart. As for whether the Golden Cross and Death Cross patterns work on shorter timeframes, the answer is yes. Next, let's look at another example of a Golden Cross pattern, but this time we will focus on the performance on a shorter timeframe to see if it works just as well.
(2) Example 2
GBP/JPY 4-hour chart Golden Cross
As shown in the previous example, a golden cross pattern has formed, however, the current price is far from a suitable entry point. In this case, investors can only wait patiently for the market to pull back, as shown in the figure below.
GBP/JPY 4-hour chart Golden Cross entry ticket
The price has retraced back to the moving average and is starting to show signs of rejection from this line, from this we can enter a trade with a stop loss placed just below the previous low, in this example we are simply waiting for the crossover to reappear as shown below.
GBP/JPY 4-hour chart: Golden Cross Take Profit
This example shows that the trading principles above can be consistent across time frames, even on shorter time frames, as shown in the figure below.
GBP/JPY 4-hour chart Golden Cross Trade Overview
Operating on the 4-hour time frame allows for tighter stop losses and potentially greater profits, however, there is always a balance between risk and reward, and lower time frame charts tend to produce more false signals. Keep in mind that when the Golden Cross and Death Cross patterns are applied to different timeframes, the shorter the timeframe, the less important these signals will be in the overall market analysis, let's take a look at one last example to further understand this concept.
(3) Example 3
EUR/CHF 4-hour chart Golden Cross entry
Similar to the previous example, on the 4-hour timeframe, the moving averages have formed a golden crossover, with price at the crossover area and showing signs of rejection from that area. Based on this, we will execute a trade with a stop loss set well below the previous trough and below the moving average, as shown in the chart below.
EUR/CHF 4-hour chart Golden Cross Trade Overview
So what has happened to the market? Although the price has certainly moved in your favour, as the market pulls back the price has reached the breakeven point which can cause some frustration, especially if the price was initially in profit.
However, please remember that this is part of the trading process and how you manage your trades and achieve profitability is now entirely up to your strategy and decisions. I recommend that you explore and try different profit taking strategies. There is no right or wrong way to achieve profitability. Remember that even if a trade does not generate a net profit, breaking even can be considered a success in itself.
7. Limitations of the Golden Cross and Death Cross
(1) Lagging indicators
Both the Golden Cross and the Death Cross are lagging technical indicators. These indicators are based on historical price data and may indicate a trend change only after the new trend has actually formed. This lagging nature may cause traders to miss the best time to establish a position, thereby potentially missing out on most of the profits in the trend. For example, when the Golden Cross pattern is confirmed, most of the uptrend may have already been realized. Similarly, the Death Cross pattern may indicate the arrival of a downtrend only after the market has experienced a significant decline.
The same principle applies to setting take-profit points. As shown in some examples, due to the lag of the crossover indicator, when the exit signal appears, the trader may have lost part of the potential profit. Therefore, I recommend actively exploring and applying different take-profit rules so that you can optimize profit acquisition as much as possible during the trading process.
(2) Error signal
Another limitation of these technical indicators is that they run the risk of generating false signals, especially in a market environment with high volatility or wide trading ranges. False signals occur when the trend change indicated by the golden cross or death cross does not actually occur, which usually occurs when short-term price fluctuations cause the moving averages to cross, but do not trigger a sustained trend change. In such cases, traders may establish positions based on these signals and may suffer losses when the market reverses or remains in a range, as shown in the figure below.
AUD/NZD daily chart false signals
As market price volatility intensifies, we can observe the formation of multiple crossovers. However, it is currently difficult to determine when a death cross or golden cross will be established. The use of other auxiliary indicators can help alleviate this shortcoming, but it is important to recognize that false signals are inevitable in the trading process.
8. Conclusion
The following is an overview of the key points of this guide:
(1) Discuss the differences between the Death Cross and the Golden Cross.
(2) Select a specific strategy that applies the moving average.
(3) How to use supplementary indicators to enhance the effectiveness of trading strategies.
(4) Present real trading case studies applying different profit-taking strategies.
(5) Analyze the limitations and challenges of using lagging indicators such as the golden cross and death cross.
The Iron Law of Cryptocurrency Trading
First, for those currencies with complicated situations that you cannot see clearly, do not rush into them. Pick the weak ones and squeeze the weak ones. The same applies to currency speculation.
Second, don’t buy all your money into the same coin at once, even if you are very optimistic about it and you are proven right later, don’t buy it all at once. Because things change rapidly, no one knows what will happen tomorrow.
Third, if you mistakenly buy a currency that is on a downward trajectory, you must sell it quickly to avoid further losses.
Fourth, if the currency you bought has not lost money yet, but has entered a downward track, you should also exit and wait and see.
Fifth, if the currency is not on the upward track, it is recommended to pay less attention to it. No matter what happens to it in the future, don’t accompany the main force to build a position. Retail investors don’t have time to waste with them.
Sixth, don't fantasize about making money and always do short-term trading, going in and out every day. Frequent entry and exit may bring you pleasure, but it will make you lose a lot of money. The only one who benefits is the exchange, and you will not have such a high level, and you are not a banker. Don't buy too many currencies, preferably no more than 10, you don't have so much energy to watch them. It's like if you want to marry five wives, even if you are in good health, you can't satisfy your wives. Wei Xiaobao's story only happens in novels.
Seventh, this coin is very cheap and has fallen a lot, but it is not a reason for you to buy it, never!! It may be even cheaper!!!
Eighth, this coin is very expensive and has already risen a lot, but that is not a reason for you to refuse to buy or sell. It may rise even higher!
advice
1. Don’t throw away bull coins easily. Choose bull coins first. Get halfway. Do both hot and strong coins. Investment and speculation are both suitable. Get the whole way.
2. The most important thing for a trader is the ability to respond during trading.
3. Qualitative analysis must be done well. Qualitative analysis of large cycles, weekly coin selection, monthly identification, and daily tracking
4. Follow the rules and use Bollinger or other moving averages that you think are feasible to view the market
5. Ability cannot be taught, it all depends on technical skills. Repeat successful experiences and make making money a habit. It is more important to make money frequently than to make a lot of money.
As an old investor who has been working in the cryptocurrency circle, I have summarized 12 iron rules for cryptocurrency trading today. Every sentence is a lesson learned through blood and tears. You can save 100,000 yuan by reading this!
1. Time difference between the East and the West: Stay up late and watch the market. The market of the cryptocurrency circle is basically concentrated in European and American time (21:30-7:30 Beijing time), and the big rise is in the early morning! So, if you want to make money? Staying up late is a must! Go to bed at 20:00 and get up at 4:00 to watch the market. This is the work and rest of a qualified trader.
2. Don’t panic if the market drops sharply during the day: Foreigners pull up the market at night. If the market drops sharply during the day? Don’t be afraid! Once foreigners enter the market at 21:30 at night, they will pull it back for you in minutes! Remember: a sharp drop during the day is an opportunity to buy at the bottom. Don’t chase high prices when the market rises sharply during the day, as it is likely to fall back at night.
3. The deeper the insertion, the stronger the signal: K-line insertion (long upper and lower shadows) is a common method used by bankers. The deeper the insertion, the stronger the reverse signal!
After the pin is often the best time to buy or sell, don't be fooled by the dealer!
4. The news is bad news: before a major meeting or good news, the price will definitely rise, but once the news comes out, it will fall back immediately! Therefore, plan ahead, run as soon as the news comes out, don't be greedy!
5. Heavy positions will lead to liquidation, light positions are the way to go: Heavy positions? Congratulations, you are on the liquidation list of the exchange! The dealer focuses on heavy position users, and with a pull or a drop, you will be liquidated in minutes! Therefore, light positions are the way to survive!
6. The price falls after stop loss, and rises after stop profit: The price falls after stop loss of short orders, and rises after stop profit. The dealer just doesn’t want you to make money! Therefore, stop loss should be cautious, and stop profit should be done in batches. Don’t be led by the dealer!
7. You are almost out of the trap: Don’t dream: You will be out of the trap immediately? The rebound suddenly stopped! How can the banker let you run away easily? Therefore, reduce your position appropriately when you are close to being out of the trap, don’t be greedy!
8. Excitement = Waterfall Warning: When you are too excited, the waterfall is coming! The dealer is using your emotions to cut leeks, so staying calm is the best way!
9. When you have no money, the market is full of opportunities: When you are penniless, every coin is rising, and the FOMO emotion is full! But remember, 80% of the market is manipulated, don't get out easily, only patient waiting can make you a winner!
How can you survive in the market for a long time? To survive and succeed in the market for a long time,
Here are a few key strategies to follow:
1. Risk Management
Use spare money for investment and avoid using high leverage or loans.
Set a stop loss point. Once the preset loss limit is reached, you should sell decisively to avoid further losses.
2. Investment strategy
Diversify your investments: Don't invest all your money in one project, but invest in different currencies and projects to reduce risks. Long-term holding: For high-quality projects, hold them for a longer time and use the compound interest effect to achieve wealth growth. Sell at the right time: When the market is high, if there is obvious bad news, it may be a good time to sell.
3. Information acquisition and processing
Build your own information source, such as CoinMarketCap+, Defllama+, etc., to obtain accurate market data
Learn to distinguish the authenticity of information and avoid being misled by false information
4. Psychological adjustment
Stay calm and don't be affected by short-term market fluctuations.
Set reasonable expectations and avoid excessive trading and frequent operations.
5. Keep learning
Regularly learn about blockchain technology and digital currency, keep pace with industry development, participate in community discussions, exchange experiences with other investors, and broaden your horizons.
6. Balance between life and investment
Ensure that investment activities do not interfere with your daily life and health.
Maintaining a healthy mind and body will help you better cope with the challenges of the investment process
Successfully recovered the capital and doubled the account. Follow the rainy day, reserve a spot in advance, and eat big meat! ! !
Continue to focus on: LPT RPL TRB