After years of engaging with the cryptocurrency world, starting from an initial amount of $3000, my funds have slowly grown to eight digits. Today, I would like to share my hard-earned experiences with everyone:
1. Divide your funds into five parts, and only invest one-fifth at a time! Control a stop loss of 10%. If you make a mistake once, you only lose 2% of your total funds; if you make mistakes five times, you will lose 10% of your total funds. If you are correct, set a take profit of over 10%. Do you think you will still get trapped?
2. How to further improve the win rate? Simply put, it's about going with the trend! In a downtrend, every rebound is a trap for buyers, while in an uptrend, every drop creates a golden buying opportunity! Do you think it's easier to make money by bottom-fishing or by buying on the dips?
3. Do not invest in cryptocurrencies that have surged rapidly in the short term, whether mainstream or altcoins. There are very few coins that can make several waves of major upward trends. The logic is that it is quite difficult for a cryptocurrency to continue rising after a short-term surge. When it stagnates at a high position, it will naturally fall as it cannot be pushed up any further. This is a simple principle, but many still want to take a gamble.
4. You can use MACD to determine entry and exit points. If the DIF line and DEA cross above the 0-axis, breaking through the 0-axis is a solid entry signal. When MACD forms a dead cross above the 0-axis and starts to move 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 great losses! Many people keep adding to their positions as they lose more, which only leads to greater losses. This is a big taboo in trading cryptocurrencies; it puts you in a dead end. Remember, never average down when you are at a loss; instead, increase your position when you are in profit.
6. The volume-price indicator is crucial; trading volume is the soul of the cryptocurrency market. Pay attention when the price breaks out with increased volume at a low consolidation level, and decisively exit when there is increased volume at a high level with stagnation.
7. Only trade cryptocurrencies that are in an upward trend, as this gives you the highest probability of success and saves time. A turning point upwards in the 3-day line indicates a short-term rise, a turning point upwards in the 30-day line indicates a medium-term rise, a turning point upwards in the 84-day line indicates a major upward trend, and a turning point upwards in the 120-day moving average indicates a long-term rise!
8. Insist on reviewing each trading session, checking if there have been changes in your holdings, analyzing whether the weekly K-line trends align with your judgments, and whether there has been a change in trend direction. Adjust your trading strategy in a timely manner!
I remind everyone to invest cautiously and to operate within your limits.