In the volatile cryptocurrency market, my three years of experience have led me to summarize these practical survival rules. Mastering them can help you avoid many detours.
One, the breakthrough code for small capital (200,000 death line)
For investors with a principal of less than 300,000, remember not to easily engage in contract trading. Using a principal of 50,000 to successfully roll over three times can potentially break through the million funding threshold. In a year, major rising waves usually occur only 2-3 times. Taking the 2021 DOGE hundred-fold rise as an example, many signs were evident beforehand: First, the perpetual funding rate on exchanges broke 0.1%; second, the total liquidation amount exceeded 500 million for three consecutive days; third, community activity surged by 300%. Once the opportunity for a major rising wave is captured, immediately withdraw the principal and use the profits to continue participating in market games.
Two, the cruel truth of cognitive monetization
It is recommended to use TradingView's simulated trading for training and to force yourself to review trades for three hours daily. Based on experience, simulated trading returns ×0.3 ≈ actual trading returns. When you can achieve a 300% return in simulated trading for three consecutive months, with maximum drawdown controlled below 15%, then consider entering actual trading. Sudden market movements between 3:00 AM - 5:00 AM are often key moments to test investment mindset, and should be given special attention.
Three, the countdown to the death of positive news (must see!)
Remember the 'three-minute rule': price surges occurring within the first three minutes after a sudden positive news release are highly likely to be traps. Using on-chain data analysis tools like Nansen, if you find that the transfer volume of the top 10 addresses surges by 200% within one hour after the positive news is announced, you should immediately sell at market price. Reflecting on the 2022 LUNA collapse, whale addresses showed collective unusual activity 36 hours before the collapse.
Four, bloody harvesting during holidays
During the 72 hours before major holidays like the Spring Festival and Christmas, be sure to reduce your position by 50%. Data shows that from 2020 to 2023, the average market drop in the 48 hours before the Spring Festival reached 23.6%. Using the Coinglass long-short ratio indicator for assistance, when the long-short ratio exceeds 1.5, the probability of liquidation before the holiday reaches 82%.
Five, snowball capital management techniques
It is recommended to adopt the '532 configuration' for allocating funds: 50% in mainstream coins (such as BTC, ETH), 30% in new public chains (such as SOL, AVAX), and 20% in MEME coins. Whenever profits exceed 30%, immediately transfer 50% of the funds to a cold wallet. According to the formula 'principal × (1 + 30%)^5 = 4.56 times the principal', stable growth of funds can be achieved.
Six, the golden code of short-term trading
Focus on the combination of the 15-minute K-line and the EMA21 moving average. When trading volume exceeds three times the 20-day average, and the RSI indicator forms a golden cross in the 30-70 range, the trading win rate can reach 68%. The time from 10:00 AM - 11:00 AM Eastern Time is when Wall Street institutions concentrate on repositioning, making the market prone to reversal, so pay close attention.
Seven, the vitality in the crash
Remember the 'waterfall three-wave law': the first wave primarily harvests retail investors, the second wave targets leveraged investors, and the third wave destroys investors' faith in the market. When the 1-hour K-line shows a long lower shadow doji, and the funding rate for futures falls below -0.05%, the probability of a market rebound exceeds 75%. The rally of BTC from 20,000 to 30,000 in March 2023 perfectly confirmed this rule.
Eight, the art of stop-loss
Set a dynamic stop-loss line: use ±3% of the opening price as the first stop-loss level. If it drops below this, immediately reduce the position by 50%; if the price continues to drop by 2%, then close all positions. When losses exceed 5% of the principal, a mandatory three-day break is required to adjust. You can use TradingView's alert feature to achieve automatic monitoring of stop-losses.
These rules are a summary of practical experience, but the market changes rapidly. If you have questions about a particular rule or want to learn more specific operational techniques, feel free to communicate with me at any time.
