Insights from these days in the crypto circle! Dedicated to friends who just entered the circle.
1. Don't get attached to hot coins; when altcoins profit reaches a certain point, it's time to exchange. Trying to hold from start to finish is bound to be in vain. The reasoning is simple: altcoins cannot rise forever. After trading, you must exchange; otherwise, if it drops back to the starting point, it will be a wasted effort. For example, FIL and LUNA from years ago.
2. When prices are consolidating at high levels and then surge again, seize the opportunity to sell; when prices consolidate at low levels and hit new lows, a good opportunity is likely to arise. When the price is at a high and makes new highs, be wary of market manipulation; you should reduce your position or exit without hesitation. Conversely, when the price consolidates at a low and creates new lows but quickly rebounds, it is likely a final shakeout by the main forces, and one should remain resolute.
3. When the market environment is poor, prices may rise against the trend; small rises against the trend could lead to significant gains. In a good market environment, prices may slightly drop against the trend; small drops against the trend could lead to significant losses.
4. Only increase your position when making a profit; don't average down when losing. This might break many people's perceptions. We should increase our positions when the price breaks above previous highs, not when it keeps falling, as averaging down will only increase losses, making it impossible to recover. Be sure to cut losses and let profits run.
5. As long as you identify the bottom price, generally, the trend will be to move up two steps and down one step. At this point, don't doubt it; usually, great surprises follow, especially when trending upwards, there's often a simultaneous rise and consolidation. Don't exit lightly.
6. Top players first look at sectors, second-tier players look at individual coins, third-tier players look at indicators, and bottom-tier players only gamble. This means when we want to buy a particular coin, we should first look at the sector; only by engaging in popular sectors can we attract more attention and have a higher win rate. Next, look at the tokens. Those who only look at indicators are novices, and those who look at everything are gamblers.
7. Indicators change with volume and price, so volume and price are the roots of indicators. If you trust indicators without looking at volume and price, you'll face difficulties in trading. Indicators are calculated based on coin prices and trading volumes, so true technical analysis requires looking at volume and price. Price increases require significant capital to drive them up.
8. In an upward trend, look for support; in a downward trend, look for resistance. When prices are rising, operating successfully relies heavily on support lines, providing opportunities for low buys on pullbacks. In a downward trend, successful operations depend on resistance lines, providing opportunities to short or exit.
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