In the first three years of trading cryptocurrencies, I entered the market with a capital of 200,000, but ended up with only 10,000 remaining. Relatives and friends advised me not to trade anymore, saying that trading like this was foolish, neglectful of family, and lacking ambition. I have heard many harsh words, and at that time, I almost gave up; I looked down on myself.
But I just couldn't accept it; I vowed to my family to gamble again with this 10,000! Then I calmed down and studied, and unexpectedly, with this 10,000, I made 25.6 million in three years!
No bragging; when you truly find a method that suits you and strictly follow it, you will surely turn things around!
Any trader who can ultimately make money is a trend trader!
There was a time when I was also enthusiastic, making trading plans early and writing trading insights late. Winning brought joy and craziness, while losing brought sadness and embarrassment. I once made a fortune in large unilateral trades, unable to sleep for several days, and also simmered in warm water, leading to severe energy loss and hesitation.
After experiencing peaks and troughs, basking in the red sun, and seeing the bright moon. Regardless of whether people gather or scatter, regardless of highs and lows, I am there, not too big nor too small, and no one knows.
Having seen through human nature and uncovering the essence, there is not much superficial glamour to sway emotions. Gradually expand my profits while quietly telling many real stories in the futures world that few know.
These stories have a starting point but may not have an endpoint. These stories occurred in the past, truly moving, but they will also happen in the future because human nature is difficult to change, and there is hardly anything fresh under the sun. The 80/20 rule existed in the past, plays out now, and will continue to be reserved for the future.
I am a stable profit manager; I act as everyone’s eyes because I am deeply embedded in the core of the futures investment circle, and using the tip of the spear to describe it is not excessive.
As long as everyone is interested in knowing something, I will share as much as possible. As for whether what I say is true, those who have entered the circle will naturally understand in their hearts; the insightful will be clear, and the pure will be transparent. This information is significant for investors struggling to grasp the essence within the circle.
Over the years, I have earned money from the market, but I understand in my heart that it is all funds from ordinary investors. I cannot contribute much, but I am willing to share my years of experience and insights with investors as a return.
Hope is good, but futures investment cannot be mastered overnight. My suggestion is to not invest any money at first.
If you really want to do well in futures investment, you need to patiently do your homework before entering, and the best way is to have a good predecessor to lead you, guiding you to learn and improve quickly, which can save you four to five years of exploration time.
First. Do not invest a penny. Because newcomers are too unfamiliar with this place, any small unfamiliarity and oversight may lead to losses, and even more so, cause emotional fluctuations, resulting in even larger losses.
Avoiding large one-time losses and avoiding consecutive small losses is an important aspect of risk control in futures investment.
Secondly, feel and understand. You can open a simulated account and familiarize yourself with the various environments and mindsets of futures trading while operating through the simulated account. This is a process that takes time. This process can help you slowly feel less unfamiliar with many aspects of futures, laying a good foundation for further trading in the future.
Again. Determine your basic operational strategy, make small exploratory investments with minimal capital, and test the waters. From your personal investment strategy, unfamiliarity means risk, and making exploratory investments that do not affect the overall situation under unclear risks is a wise move.
There are many ways to profit, but only long-term, stable, and ideally profitable models count as real. If this characteristic is not reflected, profits and losses will alternate, sometimes peaking and sometimes troughing, ultimately resulting in no significant benefits.
After clarifying this concept, I can recall many successful investors I vaguely know. They have different styles: some profit from technical indicators (good psychological quality, long-term persistence), some profit from intuition (excellent psychological quality, gifted), some profit from macroeconomic strategic thinking (good psychological quality, extremely patient), and some profit from being cautious (average psychological quality, but their timid nature leads them to exit decisively at the first sign of loss).
All of the above have their characteristics and have undergone long-term tests in the market, at least so far they have been relatively successful. The ways to profit vary; you need to first analyze yourself, understand what kind of person you are, what style of things you are likely to do, and develop a trading model suitable for yourself.
Maybe it doesn't suit others, but it suits you. What is suitable is the most reasonable and the best. If something is inappropriate, please bear with it.
I have seen people making quick profits; electric vehicles really turned into Mercedes-Benz, but ultimately lost money quickly as well. It's not surprising to see a Mercedes-Benz turn back into an electric vehicle. I don't particularly like the empty joy of wealth on paper; my achievements are not the best, but my overall style is relatively stable.
Apart from the loss in the 7th month of the previous year, all other months have been profitable. In terms of results within the circle, it's only considered average, but stability is outstanding. What impressed me deeply is that out of 14 major accounts in the large account area, only 2 remain now.
One is me, and the other is Senior Xue. Neither of us can be considered to have earned much; we can only say we have been stable. The elder once said: 'Do not fear slowness, but fear speed.' There must be some truth in it. Let’s encourage each other. Continue to remain humble and steady in our progress.
Let me ask an old question: Can the market be predicted? My answer is: I don’t know; I can’t predict, and none of my friends can predict either. Perhaps I am still ignorant. However, friends who profit without relying on predictions are often seen.
The varieties I participate in are more inclined towards the Shanghai market, which has a large capital capacity and a high degree of opposition. The copper, zinc, rubber, and rebar in the Shanghai market are the key varieties I deploy my funds into.
The largest capital deployment is in IF stock index futures. The overall capital deployment style is: overall distribution, highlighting the focus. Participating according to the main and secondary contradictions based on their intensity can comprehensively control the systematic risk of capital accounts while stabilizing profit growth.
My method is not the best. I have seen accounts with extremely meticulous capital deployment doing very well, and I envied them. However, I am not able to do that yet.
Based on my two personal experiences in 2005 and 2008, technical patterns have reasons to rely on and can be traced back to reality. The unilateral copper bull market that began in 2005 and the unilateral copper bear market in 2008, I believe that those who participated either suffered huge losses or made huge profits, but no matter what, they left a deep impression.
Especially in the second half of the unilateral decline in 2008, the Shanghai side continuously raised the margin ratio and even took measures for agreement to close positions to ease the opposition. I felt deeply involved in the market at the time, and nearly half of my positions were forcefully closed based on agreements, which was very regrettable. Even years later, I still vividly remember.
In terms of technical patterns, the breakthrough from new highs in 2005 and the downward breakout from the standard converging triangle in 2008 are things that any investor with a basic understanding can comprehend.
It has been proven to be successful without a doubt. But I want to emphasize the unsuccessful situations; my impression is that successful pattern trends occurred twice between 2005 and 2008, while unsuccessful pattern trends occurred four times, with a success rate just above 30%. This conclusion is based on facts, and facts are the only standard for verifying truth, which is hard to refute.
A low success rate can still be attempted, as the profit rate from the two successful pattern trends exceeds 700% (composite profit rate), while the loss rate from the four unsuccessful pattern trends is 67% (also composite).
This means that there is no absolute effectiveness, nor absolute ineffectiveness, but there is absolute effectiveness in maintaining profit growth under strict stop-loss discipline. This can be fully explained philosophically, and the facts have successfully verified this.
There is no absolute effectiveness, but there is relative absolute effectiveness. This is my view.
I can share some insights on intraday trading; first, do not start trading, watch how others trade, especially accounts with extremely unsatisfactory trading results.
You can spend a month observing these accounts daily, just observing how they incur losses, how they let losses gradually expand to an uncontrollable level, how they harbor illusions, how trading plans change repeatedly, and how the trader's psychological defenses are ultimately breached. Once you have observed and memorized this for a long time, I believe that as long as you have the basics, intraday trading will greatly improve.
My experience is that when they are profitable, they will only hold for a short time, quickly closing positions to avoid losses. However, when they incur losses, they struggle internally, continuously finding reasons to hold onto losing trades until the losses become uncontrollable, ultimately reflecting trading characteristics: big losses and small gains.
Need to think in reverse. Successful people are not spectacular because they are successful; they are successful because they are spectacular. Need to think in reverse.
Even large-scale opposing funds need to follow the basic supply and demand relationship, especially in today's globalized world; blindly creating strategies can no longer lead to successful forced liquidation; otherwise, the harsh reality of spot delivery is right in front of you.
Do you remember the peak battle of huge opposing funds in Jinrui futures in 2005 and 2008? Just the pure opposing funds exposed publicly were all over 2 billion, making them the most powerful opposing party. The result, however, was two defeats, tragically.
Facts show that opposing funds do not conform to basic supply and demand or the overall market forces, and still face disastrous defeats. Therefore, based on this point, whoever stands with the market in compliance is the active side, and whoever stands against the market is the passive side.
My other feeling is that whether on our side or the opposing side, regardless of the size of the capital and how fierce or sluggish the methods are, we must follow the trend; history has repeatedly verified that those who follow will thrive, and those who oppose will perish.
Even Soros's attack on the pound was based on detailed analysis, concluding that the fundamental trend of the pound would inevitably lead to a depreciation trend, which allowed him to take action to intensify contradictions and burst asset bubbles, serving merely to follow and promote, rather than to reverse.
The market is relatively fair to any investor (China cannot achieve absolute fairness, as we all know). As you mentioned, when opposing Zhejiang and Shanghai, if Shanghai had timely followed the trend and recognized losses to exit, the tragedy of forced liquidation would not have occurred.
Losses are only limited. No one can unilaterally provoke opposition; contradictions need both sides. A war without opponents will never yield results.
Still the old saying, classic saying: those who follow will thrive, those who oppose will perish. If you stand with the historical trend, continue to stand firm, and appropriately ride the wave, creating new opportunities. If you stand against the trend, quickly recognize your mistake and leave, immediately standing with the compliance.
The market's ultimate direction has its own rationale; investors will not make big mistakes if they continually try and quickly leave after making mistakes. If they insist on going against the grain, they will be cannon fodder.
I often quietly observe those in the market who act unilaterally through my technical means, and the data I summarize shows this characteristic: the smaller the capital, the more investors can resist losses; the larger the capital, the more investors can hold onto profits. Suppose there are 10 trading days; investors with small capital have profits for at most 3 trading days, and the profits are very small.
Investors with large capital have nearly 7 trading days of profits, with a profit to loss ratio of 12:1. Here, the size of the capital refers to the intersection of investors, not the union. The retail funds consumed daily average about 1% to 4%; I witness such hunting battles every day, and I gain a lot from it.
I have a profound feeling that before trading, I have conducted in-depth research and analysis, and I have done so based on the historical facts of each variety. Achieving clarity in one's understanding is a rare quality.
Moreover, all trades are strategy-based, with corresponding strategies to handle each situation, which is very reasonable; this can also avoid unnecessary risks. Of course, this reflects the comprehensiveness, systematization, and strategic nature of thinking from another perspective.
My suggestion comes from my experience; you should reduce the number of varieties you operate on, striving to select the varieties you are most familiar with and capable of operating, ideally around three. Specialization is key; you cannot be excellent in every field, but you can absolutely be an expert in a few specific areas. A strategy allocation among three varieties is enough to share risks and profits.
Fix your time segmentation, fix your volatility, fix your capital allocation, and fix your win-loss ratio. Like an equation, you must first determine the unknowns, know where you want to go, and then think about how to get there.
Relatively fixed value ranges can greatly reduce your breakthrough difficulty in the early stages of technical breakthroughs, increasing your chances of leaping forward. People do not need to be numerous, just effective. Large institutions also lose money when they make mistakes; individuals earn when they do things right. Behind futures is capital, behind capital is people, and the master of people is habit.
When it comes to a fierce competition, it boils down to who has the least human weaknesses and who has the smallest human weaknesses. Holding a casual attitude will not lead to victory. It is essential to take it seriously, objectively analyze, and gradually enhance one's rationality on the left side to overcome the emotionality on the right side.
To put it bluntly but effectively: being less human than others, being less human-like than others, and being more machine-like and absolutely objective than others. Taking money from others requires skill. If you just want to 'play with 100,000 or 80,000,' then you are definitely a target for rational experts.
1. My personal experience is that, along with other relatively successful experiences, is: during the exploratory phase, keep extremely light positions, or use simulated funds. The base position is the initial position; you can try small trades, and once profitable, it proves that you gradually have the initiative, allowing you to increase positions. The initial position should not exceed 10%.
2. General principle of stop-loss: The shorter the time, the better; the smaller the range, the better. The more resolute the attitude towards stop-loss, the better. Facts have proven that for a correct trade, the time of floating profit is far greater than the time of floating loss.
Wrong trades often dwell on losses, while correct trades always focus on profits. There is also a detail: particularly proactive trades often see 100-point trades continuously expanding profits, while ordinary proactive trades often take a long time to gradually expand profit margins.
You need to delineate levels based on objective facts, and then control positions according to those levels. In short, the more proactive you are, the more you strike; the more passive you are, the more you hold back.
What impressed me the most and benefited me was a small story. The protagonist of this story is a foreign futures master, whose name has faded. After he fell into adversity and went bankrupt several times, he established a basic capital management method for himself: no matter what method or strategy is used, if he loses 500 dollars in a day, he must leave the market and go home to rest. I felt this deeply during the first 1-2 years.
It is this educational story that has kept me from experiencing major losses during the least favorable years. Surviving is the only way to possibly live better. I hope we always remember this story and this saying. Let’s encourage each other.
The essence of trading is: cut losses when wrong, hold on when right, small losses for big gains, and create significant profits and losses. Specifically for each core link:
1. Follow the trend: find a simple moving average to divide long and short, only go long above, only short below.
2. Test positions: go with the trend, follow the big trend against the small trend, and consider entering positions with a potentially large risk-reward ratio; if you enter at this position and are wrong, the stop-loss is small, but if you are right, the profit is large, usually at the trend bottom or early stage.
3. Test position stop-loss: If the key point is broken, must stop loss, no room for luck. If the price returns, you can find another opportunity to enter. Do not have a lucky mentality, thinking that you can hold on or it might come back; you must not try to average down losses.
4. Add trend positions: increase positions on floating profits; adding positions is the core of making big money. After the price rises according to expectations and retraces, add positions at the support level or breakthrough of previous highs—follow the big trend and counter the small trend.
5. Set stop-loss for trend positions: for newly added trend positions, move the stop-loss to the new key point. The base position is already secure; only the risk of the added positions remains. If it fails, stop-loss on the added position, wait for the next opportunity. If it continues to rise, hold the position firmly, continue to wait for a pullback to add positions, and keep moving the stop-loss until the last move is stopped out or a head signal appears for take-profit.
6. Take profit: Never easily take profit; this is the key to making big money. Exiting can be done in batches or all at once, preferably all at once, as it allows you to wait for the highest probability head signal. If it is a right-side trade, floating profits will definitely retrace, and you must accept this mentally; do not think about selling at the highest point, or feel that waiting for the highest point to sell is a loss. As long as you can grasp and adhere to these principles in practice and maintain discipline and consistency, you will find that making money is a natural thing.
The success rate is as high as 94%! The 'white three soldiers' candlestick pattern should be traded like this.
In Japanese candlestick patterns, the white three soldiers (Three White Soldiers Pattern) is a bullish reversal candlestick pattern that typically appears at the bottom after a price decline, indicating that a price reversal may occur soon.
Since the white three soldiers pattern is a bullish reversal pattern, we hope to see the price decline before this pattern appears, making it a common signal for trend endings.
How to identify the white three soldiers pattern?
The white three soldiers pattern is a three-candle pattern composed of three consecutive bullish candlesticks, located at the bottom of a downtrend. It is the mirror version of the 'Three Black Crows' pattern.
The method to identify the 'white three soldiers' pattern on the chart is as follows:
◎ Three consecutive bullish candlesticks.
◎ The body is larger.
◎ The shadows should be small or nonexistent.
This pattern looks like this on the chart:
Therefore, to identify the white three soldiers candlestick pattern on the chart, you need to find three consecutive bullish candlesticks that appear at the bottom of a downtrend.
In addition, each candlestick must have a relatively long body, and the opening price must be higher than the closing price of the previous candlestick, ultimately forming a 'V' shape.
Variants of the white three soldiers candlestick pattern.
Of course, the white three soldiers candlestick pattern may look different on daily trading charts.
You may see a large gap between the closing price of one candlestick and the opening price of the next, causing them to start from within each other.
You will often see the candlestick gradually getting smaller during the formation process.
It may look like this on the chart:
How to trade the white three soldiers candlestick pattern.
To trade the white three soldiers candlestick pattern, simply finding the same shape on the chart is not enough.
What makes the pattern effective is not just the shape, but also its position of appearance. This means that the same shape appearing in different locations may signify different meanings.
When trading the white three soldiers, we first want to see the price decline, forming a bearish trend.
The white three soldiers pattern that appears after this bearish trend may be a signal for an upward reversal.
It looks like this:
So when should we enter trades based on the white three soldiers pattern?
It's simple; when the high of the last candlestick is broken, you can enter the trade.
This is your trigger for adopting a conservative bullish strategy, as shown in the figure below:
In terms of stop-loss, we can set it below the first candlestick of the white three soldiers pattern.
Moreover, to improve accuracy, we hope to trade the white three soldiers candlestick pattern by combining other technical analyses or indicators.
Trading the white three soldiers candlestick pattern strategy.
Strategy 1: Use trend reversal indicators—RSI and stochastic oscillators.
The two most effective indicators for confirming trend reversals are the Relative Strength Index (RSI) and the stochastic oscillator. Essentially, these technical analysis tools indicate overbought and oversold areas, which may help you identify potential reversal zones.
As seen in the following AUD/USD 1-hour chart, when the white three soldiers pattern appears (with RSI below 30 and stochastic indicator below 20), both RSI and stochastic indicators are in the oversold region. This validates the candlestick pattern and provides additional signals for the impending trend reversal.
In the above example, the trader will establish a long position after the third bullish candlestick completes, setting the stop-loss at the lowest level of the first candlestick or below. The take-profit should be located at the highest level of the previous bearish trend candlestick.
Additionally, you can use RSI divergence to trade the white three soldiers pattern. This is somewhat different from other trading strategies.
To find a bullish RSI divergence, we first want to see the price in a downtrend, forming lower lows and lower highs.
Steps of operation:
◎ Find the downtrend.
◎ Mark the lows formed after each decline.
◎ Compare the price's lows with the RSI indicator.
◎ When you see RSI forming higher lows while the price forms lower lows, you have found a divergence.
◎ Wait for the white three soldiers pattern to appear at lower lows in price, aligning with higher lows in RSI.
◎ Go long when the price breaks above the high of the last candlestick of the white three soldiers.
◎ Set stop-loss and take-profit targets, expecting the price to rise.
Strategy 2: Use Fibonacci to trade the white three soldiers.
In addition to using trend reversal indicators, you can also use Fibonacci retracement levels to detect potential support or resistance areas and determine if a trend reversal might occur.
Fibonacci shows the retracement levels where prices often reverse. Depending on the strength of the trend, different levels may work differently with the white three soldiers pattern.
Steps of operation:
◎ The market is in an uptrend.
◎ Then wait for the decline.
◎ Use Fibonacci tools to draw levels from the low to the high of this wave.
◎ When the price reaches the Fibonacci level and the white three soldiers pattern appears, this is the signal to wait.
◎ Go long when the price breaks above the high of the third candlestick of the white three soldiers.
◎ Set stop-loss and take-profit targets, expecting the price to rise.
To draw Fibonacci retracement levels, you need to find a completed trend and drag it from the lowest level of the previous trend to the highest level (as shown in the figure below).
Then, once the Fibonacci retracement levels are drawn, you can zoom in and look for entry levels. Additionally, you can use Fibonacci to find stop-loss positions and take-profit targets.
In the above example, the entry point will be the closing price of the third candlestick (because the market trading price is above the 78.6% Fibonacci level).
Then, the stop-loss can be set at the lowest level of the first candlestick or at the 0.0% Fibonacci level (i.e., the lowest level of the previous price range). Finally, the take-profit should be set at the highest level of the previous trend or at one of the lower Fibonacci levels.
Strategy 3: Use moving averages to trade the white three soldiers.
The moving average is an excellent indicator for trend trading. When the price is in an uptrend, the price will retrace toward the moving average.
Steps of operation:
◎ Find the uptrend, the price jumps above the moving average.
◎ Wait for the price to drop to the moving average.
◎ Check if the white three soldiers pattern appears on the moving average.
◎ Go long when the price breaks above the high of the last candlestick of the white three soldiers.
◎ Set stop-loss and take-profit targets, expecting the price to rise again.
What is the success rate of the white three soldiers pattern?
According to the Encyclopedia of Candlestick Charts written by internationally renowned trader Thomas N. Bulkowski, the white three soldiers candlestick pattern has a success rate as high as 84%.
Advantages and disadvantages of the white three soldiers candlestick pattern.
Here are the most common advantages and disadvantages of trading the white three soldiers pattern:
Summary
The white three soldiers is a pattern of three candlesticks.
To ensure effectiveness, it must appear after a price decline.
This is a bullish reversal pattern, indicating that it signals a potential upward reversal in price.
To improve accuracy, you can use RSI, moving averages, and other trading indicators to trade the white three soldiers.
The success rate of the white three soldiers candlestick pattern is 84%.
It is worth noting that no trading strategy is universal; sometimes, when you are using a strategy, you will encounter significant market shifts, and the market begins to develop with strong momentum.
To ensure you can bear appropriate risks, please appropriately lock in profits when the trend is in your favor, taking the gains.
Remember to always test these strategies or indicators in simulated trading.
Understanding trading cryptocurrencies is a similar process, going from losing seven to breaking even to making one profit; it is about being focused and not greedy for various profit models; firmly sticking to one trading system, over time, this system will become your ATM.