Recently, a remarkable person @不太会交易, in the Square Alliance competition, with a team of one, made nearly $8 million, and publicly revealed his trading strategy!
Let's get to the point: the principles/experiences/lessons of contract trading.
1. Position control, never lose chips, stay at the table.
Details involve observing the price volatility of tokens and the bottom-building area; for example, if BTC has only 10% volatility over a month, playing 30x short-term can still work, but a 2% fluctuation on the rising list in one minute can be dangerous at over 5x.
Develop the habit of segmented entry position management;
Develop the habit of placing stop-loss orders before bed to guard against black swan events;
I strongly advise against trading full-time with debt;
At this point, your psychological pressure will make it harder for you to overcome human weaknesses, which is a minus in trading.
I suggest you first pay off loans with a stable and legitimate job and career, during which you can improve your understanding, invest with spare money, learn to befriend time, don't rush, if you don't succeed at 30, wait until 35, if 35 doesn't work, wait until 40, have the courage to plan your life.
2. Know yourself and know your enemy, and you will never be defeated.
My habit is to make multi-factor judgments and have sufficient understanding of all macro news/trends/fundamentals related to the tokens.
For example, on 6/13, I posted a short strategy for $NXPC, where I revealed all my research-based insights and various potential turning points, as well as how I executed my segmented strategy. Even though there were expectations of Tencent's acquisition, I stated that the momentum was strong, and I fully disclosed the underlying logic, doing pure incremental shorting primarily to set an example; under normal circumstances, you should wait for the buying power of acquisition expectations to weaken before entering.
3. Taking profit and stop loss are equally important as judging trends; they are core trading qualities.
Take profit: Almost everyone will incur losses due to their mindset; you should settle the expected returns of your position in a timely manner. Also, never regret missed opportunities or selling too early; this reflects your mature trading system.
Stop loss: A 10% loss requires an 11% gain to break even, while a 90% loss requires a tenfold gain.
4. After mastering the basics, practice more, find your own profit formula, and leverage your strengths.
Super short-term, short-term, swing mid-term, on-chain, long-term. You should regularly summarize the elements of scenarios where you frequently generate profits, and use time to verify accuracy, capturing profitable formats that you excel at without engaging in learning with small positions in things you don't understand.
Those who like to watch K-line charts and various indicators only apply to BTC/ETH without special news impact; altcoins are basically useless, and concentrated chips can easily be toyed with by the main force.
However, I recommend learning these trading indicators and macro indicators for aiding in the analysis of macro trends and key price level areas. On Twitter, I follow some quality content creators, such as political news - Phyrex/K-line indicators - Crypto_Painter/beginners should watch - the incomprehensible sol, etc.
5. Patience, wait for the best entry point, and cultivate a gradual wealth mindset.
I prefer limit order flows rather than market order flows.
I strongly recommend that after learning to judge points, place limit orders at various points that seem unreachable in the short term; these often lead to substantial gains and have a very high win rate.
I've seen too many people who think about getting rich overnight and recklessly open positions and engage in PVP; they all got carried away. You must learn to befriend time; achieving an annualized return of 8% in traditional finance is already remarkable. Do you think it's difficult to aim for a stable 30% return without liquidation? For example, BTC spot has increased sevenfold from 2023 to now, and the super cycle of blockchain over 3-4 years is perfect for friends with substantial capital to play.
"Find opportunities to open positions with small bets, rather than thinking about making money while opening positions."
6. Avoid reverse trend positions on impact tokens.
For example, even if TRUMP has a high market cap, I wouldn't short it because TRUMP's calls can explode at any time, just like the recent TOP HOLDER meetup.
For example, even if ETH has terrible on-chain fundamentals and GWEI is nearly 0, I still don't short during this period because the Grayscale staking ETF results are imminent after 6.2, and BlackRock's ETF has seen huge net inflows for several days.
For example, if there are IPO news for TRX, first judge the authenticity of the news source and whether there is a possibility of reversal. If there is a possibility of reversal and debunking, don't enter easily.
7. Avoid coins on the rise or fall lists under non-event influences.
Those who fantasize about tokens rising over 50%-100% in a day to do reverse trades often lose 90% of the time because they cannot withstand such volatility, and the market makers can easily manipulate the charts.
The best way is to observe the historical data of the target, and observe the style and periodic frequency of MM (market makers). The periodic surges and plunges are usually caused by the main MM's swings; you can ambush in the bottom-building area instead of chasing after the surge.
If the negative rate rises above -2% and settles in one hour, the winning rate for longs may actually be greater than for shorts. However, in such cases, be careful of continuous rises in spot while the contract OI decreases; this is a deep subject that needs to be discussed later.
Also, don't short tokens that are about to be delisted; most of them are artificially inflated by exchanges. If they crash, the exchange will compensate the counterparty, so they will hover until delisting and liquidation. (This happened two months ago.)
