In the cryptocurrency market, a steady and methodical approach is essential. After entering the crypto space, you must learn to manage your positions, play steadily, and you can achieve monthly returns as high as 70%.
1. Fund Allocation and Risk Control: Diversifying investments and setting reasonable stop-loss limits are fundamental to avoiding risk. If you only use one-fifth of your funds each time and set a stop-loss at 10%, even if you incur losses five times in a row, you will only lose 10% of your total funds. This method effectively avoids significant losses from a single mistake.
2. Follow the Trend: In the market, you must learn to judge buying and selling based on trends. Following an upward trend and taking advantage of downward opportunities to buy low is key to increasing your success rate. Opportunities during rebounds or downtrends are often more easily captured.
3. Avoid FOMO: It is not advisable to invest in cryptocurrencies that have surged in a short period, especially since mainstream and altcoins often experience stagnation or decline after rapid increases, making it difficult for them to continue rising. Therefore, avoid chasing highs and analyze the market rationally.
4. Technical Analysis - MACD Indicator: MACD is a commonly used technical analysis tool. By observing the golden cross or death cross between the DIF line and the DEA line, along with changes at the zero axis, it can help determine entry and exit timing. A golden cross indicates a buy signal, while a death cross indicates a sell signal.
5. Averaging Down Trap: Averaging down is not a good habit, particularly during losses. Continuously averaging down may lead you to become more deeply trapped at the wrong time. Therefore, it is crucial to remain rational when investing, avoiding increasing your position during losses, and instead, consider adding to your position when in profit.
6. Volume-Price Relationship: Volume-price indicators are very important. The market's trading volume can reflect the buying and selling power. Cryptocurrencies that break out from low levels with increasing volume are worth paying attention to, while high-level stagnation with volume should prompt a decisive exit.
7. Trend Analysis: To determine if a cryptocurrency is in an upward trend, you can judge using short-term and long-term moving averages. If multiple moving averages are trending upwards and continuously forming a trend, it indicates that this cryptocurrency may have good upward potential.
8. Review and Adjust Strategies: Continuous review and adjustment of strategies are crucial. The market can change at any time, so you need to regularly check your investment direction and position to ensure alignment with market trends.
