Step 1: Breakthrough of 100U three levels (accumulate capital quickly)
Initial capital: Use 100U to gamble on hot coins (such as BTC, ETH, SOL, etc.) each time, and strictly set stop-profit and stop-loss (it is recommended that the profit-loss ratio be above 1:2).
Three-level objectives:
·Level ─: 100U→200U (doubled)
·Level 2: 200U→400U (doubled)
·Level 3: 400U→800U (doubled)
Key principle: Only go through three levels at most, and after success, the principal will reach 1100U (5000 yuan → about 8000 yuan). Never fight to the end, the cryptocurrency circle requires luck, and continuous all-in is easy to "win 9 times, 1 blow up and return to zero".
Step 2: 1100U triple strategy + (steady growth + trend capture)
After the principal breaks through, adopt ultra-short orders ++ strategy orders ++ trend orders + combination methods to reduce risks and increase returns.
1. Ultra-short order (quick in and quick out, 15-minute level)
Suitable currencies: Only high-liquidity currencies such as BTC and ETH.
Advantages: Quick returns, suitable for seizing short-term opportunities when the market fluctuates violently.
Disadvantages: High risk, strict stop loss is required (5%-8% is recommended).
Strategy order (4-hour level, small position compound interest)
Position management: 10x leverage, 15U-30U trial order each time, and the profit will be invested in $BTC every week.
·Goal: Steady accumulation, avoid emotional trading.
Trend order (medium and long term layout, high profit and loss ratio)
Applicable market conditions: when a major trend starts (such as the early stage of a bull market, before good news comes into effect).
Strategy: Identify key support/resistance levels, set a profit/loss ratio of 1:3 or above, and take advantage of large swings.
Advantages: Once it hits, it is very profitable.
The ultimate goal: How to turn 5,000 yuan into 50,000 yuan?
·Third level breakthrough: 100U→1100U (2-3 successes will suffice).
Triple strategy: ultra-short orders to make quick money, strategic orders for steady growth, and trend orders to capture big market trends.
Key risk control: Never go all in, and each transaction should not exceed 20% of the principal. Withdraw profits, and convert part of the profits into stablecoins or regular investments
$BTC。
I have experienced tens of thousands of transactions, both common and rare, and each of them is a mark of actual combat, not just theoretical talk. They come from the experience of the market, not the military strategies in ancient books. Follow the (Yuanyuan Jucai) public account, let us explore side by side and make progress together!
Is cryptocurrency trading really more profitable than stock trading?
Many people think so. I think, if your capital is less than 100,000, and you want to keep your money in the cryptocurrency circle and not lose money or even make a small profit, there is a simple way that can keep you "making money". Don't worry about not being able to learn it. I can seize the opportunity, and so can you.
I am not a great person, just an ordinary person. Compared with others, I may pay more attention to a little trick. As long as you master this method, you can earn 3% to 10% more profit in subsequent transactions. A little bit adds up to a lot, which is quite good. Below I have sorted out the experience I have gained in the past few years into a few points to share with you "newbies".
1. Don’t be greedy, pick one or two coins to play with first
There are dozens or even hundreds of virtual currencies in the cryptocurrency world. However, we small retail investors have limited energy and money, so don’t try to speculate on everything. It’s best to focus on 1 or 2 coins, or 3 at most. If you have more, you will be too busy. When the market is urgent, you will have to buy or sell based on your feelings. You will have no time to judge, and you will easily make mistakes when you panic. It’s better to focus on one or two coins and slowly understand them.
2. When the market is going up or down, don’t do anything
When the market is booming, do you think, "This coin is going to double, and I'm going to get rich right before my eyes"? There is only one thought in your mind: "Recharge quickly, buy, buy, buy!" On the other hand, when the market plummets, you think, "It's over, it's going to fall to zero, sell it quickly!" At this time, your heart rate speeds up, you are in a panic, and you are most likely to do stupid things. My advice is: when the price goes up or down too wildly, just don't move, calm down and wait and see, don't be led by your emotions.
3. Don’t invest all your money, keep a steady mindset
Don't go all-in when trading cryptocurrencies. It's best to keep half or one-third of your money in your hands. This way you can cover your position if it falls, and you can add some more if it rises. If you put too much money in your position, you will be happy if it rises, but panic if it falls. Once your mentality collapses, all your decisions will be distorted. Leave yourself some room and don't push yourself into a corner.
4. Run when you have made enough money, don’t be greedy, and accept the loss
You have to set a goal for yourself when trading cryptocurrencies, such as selling when you make 20%, regardless of whether the price will rise in the future. Many people just want to make a little more, but end up trapping themselves. Greed is human nature, so you have to control yourself. The same is true when you lose money, set a bottom line, such as selling when you lose 10%, don't just bear it. Many trading platforms can be set up for automatic buying and selling, set the price and let the computer do it, don't make decisions based on your shaking hands.
5. Learn some skills, don’t rely on others for everything
Many people in the cryptocurrency circle are not from the financial industry. They may be programmers or geeks who want to make some money but know nothing. Instead of listening to other people's nonsense, it is better to spend a few days learning technical analysis. For example, looking at the basics such as K-line and moving average, knowing the basics yourself is worse than anything else. If you only rely on others' orders, you will get yourself into trouble sooner or later.
6. Take your time. Don’t go all in or clear out your entire position.
Whether buying or selling, don't do it all at once. For example, if you want to buy 10 bitcoins, you can buy them in 5 batches, either in an hour or over a few days. This way, the risk is smaller and you won't get yourself ruined by a momentary impulse. Steady and steady is the long-term solution.
7. Believe in yourself and don’t be dazzled by others
There are a lot of analyses online. Today someone is calling for a rise, tomorrow someone is calling for a fall. If you listen to them too much, your mind will be confused. The market is originally 50-50, and no one can predict the future. Others' ideas are different from yours, don't panic, just trust your own judgment. The most fearful thing about cryptocurrency trading is being carried away by emotions. Using your own brain to make decisions is the key to making money.
I specially sorted out [Price Action - Price Action Trading: 6 Things to Pay Attention to Before Trading] and shared it with those who are interested.
Price action trading can help you time your entries and exits more effectively without relying on indicators, news, or other people's opinions. The problem is, the market provides so much information (candlestick patterns, chart patterns, trend lines, support and resistance levels, etc.) that it can be hard to put it all together. Where should you start? What should you look for? Is there a price action indicator to make sense of it all? In reality, less is more when it comes to price action trading. After years of trading and experimenting, it turns out that there are only six things that matter when it comes to price action trading - you can ignore the other 90%. In the following content, I will take a closer look at these six things.
2. Market structure
The first thing a price action trader must grasp is market structure. Because if you don't understand market structure, then the charts will mean nothing to you and you won't be able to determine when you should buy, sell, or avoid the market. However, if you do understand market structure, then a world of opportunities will open up to you.
So, what is market structure? It is a framework that classifies market stages so that you know what actions to take in different market conditions. In other words, market structure tells you what actions to take - should you buy, sell or stay away from the market. At the same time, it is important to understand that market structure can be divided into 4 stages: accumulation stage, advancement stage, distribution stage, and decline stage.
(1) Accumulation stage
The accumulation phase looks similar to a range-bound market, but it is in a downtrend, as shown in the chart below.
Now, two factors are helping to push the market into an accumulation phase.
1) Bullish traders
As prices fall, bullish traders will buy when they deem prices "too low," putting buying pressure on the market.
2) Bearish traders
At the same time, bearish traders still enter the market hoping to see the trend continue. In this context, the market (also known as a range-bound market) reaches a state of equilibrium when you feel both buying and selling pressure at the same time, however, just because the market is in an accumulation phase does not mean it will break out and go higher, it also has the potential to fall further.
So if you are bearish in the accumulation phase, then you can look for selling opportunities at resistance levels. Or, if you are bullish, then you can look for buying opportunities at support levels or when the price breaks through resistance levels. When this happens, we will enter the next phase of the market.
(2) Promotion stage
The Advance Phase is an uptrend that consists of a series of higher highs and lower lows. During this phase, most traders are able to identify the trend and are looking for buying opportunities. Below is an example.
However, the market does not continue to rise continuously, and eventually, it will start to show signs of weakness, and this is when we enter the next market phase.
(3) Distribution phase
The distribution phase looks similar to a range-bound market, but it is in an uptrend, as shown in the chart below.
Now, there are two factors that contribute to the distribution phase.
1) Bearish traders
As prices rise, bearish traders enter the market to short because prices are “too high” – this applies selling pressure on the market.
2) Bullish traders
At the same time, bullish traders still enter the market hoping to see the trend continue. In this case, the market (also known as a range-bound market) reaches a state of equilibrium when you feel both buying and selling pressure at the same time. However, if the price breaks below the low of the range, then we will enter the final stage of the market.
(4) Decline phase
The down phase is a downward trend that consists of a series of lower highs and higher lows. At this stage, most traders are able to identify the trend and are looking for selling opportunities. Below is an example.
However, the market does not continue to fall forever, and eventually, it will start to show signs of strength, and this is when we are back to the first stage of the market (the accumulation stage).
3. Value Area
You have learned how market structure can provide you with a framework for understanding what action to take in different market conditions - buy, sell or stay on the sidelines. So the question now is, where do you buy and sell? First you need to understand what a value area is. A value area is an area on a chart where potential buying or selling pressure may occur. It may include: support and resistance levels, moving averages, etc.
(1) Support and resistance levels
A support level is an area of value where potential buying pressure may step in and drive the price up. A resistance level is an area of value where potential selling pressure may step in and cause the price to fall. Here is a specific example.
(2) Moving Average
A moving average is an indicator of the average value of historical prices on a chart. In a trending market, price may follow the moving average because it reveals potential buying (or selling) pressure, thus forming a value area, as shown below.
Obviously, looking for buying opportunities when prices pull back to moving averages is not a bad strategy. Remember, value areas are not limited to support and resistance levels or moving averages, as it can also extend to trendlines, trend channels, etc.
4. Enter the trigger
Market structure guides you on what action you should take (buy, sell or stay on the sidelines), and value areas indicate where you should buy and sell. Now the question is, when do you enter the trade? That is the purpose of entry triggers, which tell you when to enter the trade. Therefore, you can take advantage of two techniques: structure breaks and false breaks.
(1) Structural fracture
A structural breakout is a reversal price action pattern that allows you to enter the beginning of a new trend with less risk. Here are the key points you need to look for:
1) An uptrend is observed approaching resistance on the higher timeframes (you want resistance areas to attract sellers’ attention on the higher timeframes).
2) The price fails to make a higher high and instead makes a lower high (which gives us a reference point to place our stop loss).
3) Go short on a breakout of a swing low or support level.
(and vice versa), here is an example.
(2) False interrupt
A false breakout is a reversal price action pattern that allows you to buy low and sell high, here is how it works. 1) Look for strong bullish momentum into a resistance level (the bigger the candle the better).
2) Let price break out to an extreme high above resistance (so that more traders buy the breakout).
3) Wait for a false breakout pattern where the price suddenly reverses and closes below the resistance level.
4) Go short on the open of the next candle.
(and vice versa), here is an example.
5. Stop Loss
We have covered your trade setups, including market structure, value areas and entry triggers. But the reality is that even the most ideal trade setups can result in losses, which is why it is so important to know when to exit a trade before things go south. This is the purpose of stop losses, to protect your trading account from taking a large loss on a single trade.
Now the question is: where should you place your stop loss? Your stop loss should be placed at a level that, if reached, would invalidate (or "break") your trade setup. If you buy at support and expect buying pressure to step in and push the price higher, your stop loss should be placed just below the support level. If the price breaks below the support level, then that means your initial assumption was wrong and you should exit the trade.
So the question is, do you place your stop loss below support or do you give it some cushion?
My preference is to give it a buffer of 1 ATR (Average True Range) below support to prevent “stop hunting”, which is done as follows:
(1) Determine the lowest low point of the support level;
(2) Determine the current ATR value;
(3) Subtract the current ATR value from the lowest support price point - this is your stop loss point.
As shown in the figure below.
Now, you can apply this concept not only to support and resistance levels, but any form of value area.
This is an example of a moving average, if you buy near the moving average and expect buying pressure to step in, then your stop loss should be set below the moving average. Because if the price breaks below the moving average, it means that the moving average is no longer "respected" and your trade setup will be invalidated as shown in the figure below.
6. Higher Time Frame Market Structure
Now that we have covered your trade setups, including your entry and stop loss strategies, let’s explore the market structure on higher time frames as it helps you determine whether you should hold onto your winning trades longer or just capture short-term swings in the market.
(1) Trading against the trend
Let's say you are short on the 4-hour timeframe and your trade is in profit, however, on the daily timeframe, the market is trending up. In this case, what action should you take?
1) Option 1: Stick with your short trade and hope the market continues to move in your favor.
2) Option 2: Exit your short trade at the most recent swing low as the market may reverse against you.
There is no absolute right or wrong in either of these options. However, for me, I tend to exit the trade at the most recent swing low as the market is likely to reverse and continue its uptrend (on the daily timeframe). Now, let’s reverse this scenario.
(2) Trading in the direction of the higher time frame trend
Let's assume that you are in a long position on the 4-hour time frame and the market is moving rapidly in your favor. At the same time, the market is also trending up on the daily time frame. How would you react in this situation?
1) Option 1: Hold your long position and hope the market continues to move in your favor.
2) Option 2: Exit your long position at the most recent swing high as the market may reverse against you.
In this case, I prefer to continue to hold my long position because the higher time frames are also in my favor. When I mention "continue to hold", I am not suggesting that you hold the position indefinitely, rather, it is to trail my stop loss to ensure that I am able to follow the market trend if the market continues to move in my favor.
7. Keep volatility low on higher timeframes
Markets move in cycles of volatility, going from low volatility periods to high volatility periods, and this process is cyclical. Therefore, when the market is in a state of low volatility, it usually indicates that the market is about to make a big move, and investors should be prepared accordingly. To illustrate with a specific example, suppose you hold a long position on the 4-hour time frame and the market moves rapidly in your favor. At the same time, you observe that on the daily time frame, the market forms an accumulation pattern, which is a low volatility price action that looks like a "squeeze". In this case, what action should you take?
1) Option 1: Hold your trade in the hope that volatility expands, thus moving the market further in your favor.
2) Option 2: Exit your trade at the most recent swing high as the market is likely to reverse to your disadvantage.
For me, I tend to choose to hold my trades because there is huge profit potential if volatility expands in my favor, here is a specific example.
AUD/CAD accumulation on the daily timeframe
AUD/CAD false breakout on 4-hour timeframe
As you can observe, on the 4-hour timeframe, after a false breakout setup, the price moved in your favor. In this case, you might want to take profits at the recent swing high, as potential selling pressure could exist in that area, however, looking at the daily timeframe, you’ll realize that the market has formed an accumulation pattern (with contracting volatility), which suggests that a major move could be coming soon. So, how do you strike a balance between the two? For me, I tend to take 50% of my profits at the recent swing high. So if the market does reverse, at least I have some money in the bank. Next, I’ll hold the rest of my position and watch to see if the price is able to break above the swing high, if so, I’ll follow the market trend until my trailing stop is triggered.
8. Conclusion
The following is an overview of the key points of this guide:
(1) Market structure provides you with a framework to guide what action you should take—buy, sell, or wait and see.
(2) Value areas help determine where to buy and sell (e.g., support and resistance levels, moving averages, etc.).
(3) Entry triggers tell you when to buy or sell based on specific price patterns (e.g. price rejection, candlestick patterns, etc.).
(4) Your stop loss should be set at a level that, if reached, would invalidate your trade setup (or when your value area is “broken”).
(5) The trend of the higher time frame can help you decide whether to capture short-term fluctuations or ride the long-term trend. If you find that the trend of the higher time frame is against your expectation, take the opportunity to take profits; if the trend supports your trading direction, ride the trend.
(6) If the higher time frames are in a low volatility environment, then hold on to part of your position as you may catch a major market move if volatility expands in your favor.