I have been trading cryptocurrencies for five to six years, starting with 100,000, and now I support my family with it. This is because I have put many useful things I learned into practice and mastered them through repetition. This process is indeed very difficult. For the sake of life and family, today I share some knowledge:
1. Divide your funds into 5 parts, and only invest one-fifth each time! Control a 10-point stop loss; if you are wrong once, you only lose 2% of your total capital. If you are wrong 5 times, you will lose 10% of your total capital. If you are correct, set a take profit above 10 points. Do you think you will still be stuck?
2. How to further increase the win rate? Simply put, it’s about following the trend! In a downtrend, each rebound is a trap for the bulls, and in an uptrend, each drop creates a golden buying opportunity. Which do you think is easier to make money from: bottom fishing or buying on dips?
3. Do not touch coins that have surged rapidly in the short term, whether mainstream or altcoins. There are very few coins that can produce several waves of major upward trends. The logic is that it is quite difficult for a coin to continue rising after a short-term surge. When a coin stagnates at a high position and cannot rise later, it will naturally fall. It’s a simple principle, but many people still want to take a gamble.
4. You can use MACD to determine entry and exit points. If the DIF line and DEA form a golden cross below the zero axis, breaking above the zero axis is a stable entry signal. When MACD forms a death cross above the zero axis and moves downwards, it can be seen as a signal to reduce positions.
5. I don't know who invented the term 'averaging down', but it has caused many retail investors to stumble and suffer huge losses! Many people keep averaging down as they lose more, which is the biggest taboo in trading cryptocurrencies and puts themselves in a dead end. Remember, never average down when you're in a loss, but add to your position when you're in profit.
6. The volume-price indicator is crucial; trading volume is the soul of the cryptocurrency market. Pay attention to volume breakout at low levels during consolidation and decisively exit when there is volume stagnation at high levels.
7. Only trade in coins that are in an upward trend. This maximizes your chances and saves time. The 3-day moving average turning upwards indicates a short-term rise; the 30-day moving average turning upwards indicates a medium-term rise; the 84-day moving average turning upwards indicates a major upward trend; and the 120-day moving average turning upwards indicates a long-term rise!