Trading is definitely not gambling, but a battlefield of life and death. True traders are warriors, and the risk control system is your armor and retreat route. • Perpetual contracts ≠ gambling tools: Use leverage wisely, the key is light positions and strict stop-losses. Open positions with only 1% of capital using 100x leverage, leaving 99% as a buffer, making risks manageable.
• Practical example: With a capital of 5000U, open positions ≤ 20 lots; set trailing stop profit at 2% of unrealized profit, stop-loss ≤ 3%; limit daily trading to 2 hours—emotional stability is the highest strategy.
• Core alert: It’s not the market that destroys you, but the lack of risk control and refusal to admit mistakes.
Iron Law Two: Plan trades, eliminate emotions • Retail losses, 90% stem from the impulse to chase highs and sell lows.
• On-the-spot decision-making is a major taboo: Before buying, you must clarify your entry point, stop-loss level, and profit target.
• Operation Discipline: Increase positions in profit, reduce positions in loss, never average down. • Focus on key indicators: Don’t get emotionally moved by K-line charts, closely monitor trading volume and structural changes—real market trends come with volume, while low volume is just false heat.
Iron Law Three: Trade within the circle of competence, stay away from noise • Beware of the 'get rich quick' myth trap: the coins that rise the fastest often fall the hardest.
• Stick to familiar fields: Do not blindly chase hot spots or emotional coins; focus on mainstream coins you understand and proven trading models.
• Two main principles: Do not touch coins without independent logical support; do not gamble on altcoins that are catching up without understanding sector rotation. • Insight into essence: The value of Bitcoin remains unchanged, while the price volatility is driven by market sentiment. The essence of trading lies in understanding and controlling emotions.
Iron Law Four: Cut losses, do not hold onto illusions • Averaging down is the first step into the abyss: it stems from an obsession with 'breaking even', not from rational strategy.
• Core principle: If the position is wrong, cut losses immediately, never average down. Being obsessed with breaking even will ultimately consume the remaining capital.
• The essence of trading: Focus on process management (executing discipline), not on result obsession (recovering losses).
• Blood and tears lesson: Being trapped comes from not cutting losses, and liquidation is due to stubbornly holding positions. What you lose is not just money, but also rationality.
Iron Law Five: Focus deeply, win with a single move.
• Major pitfalls for beginners: Trying to do too much and imitating everywhere, mastering none.
• Path to success: Choose a trading feel, technique, or model, and deeply practice it. MACD, wave theory, on-chain data... it's better to specialize in one than to dabble in many.
• Core understanding: Trading is not scientific research; no need for a myriad of skills. A simple, repeatable, high-win-rate trading system is enough to keep you profitable.
Conclusion: Survival is victory • Huge profits do not come from seizing a sudden surge, but from discipline in enduring downturns, resisting temptations, and controlling impulses. • Ultimate practice: Control fear during losses and manage greed during profits. The end of trading is the management of human nature.
Summary of the five iron laws (recommended to save):
1. Risk control first: Strictly control positions, enforce stop-loss.
2. Plan trades: Eliminate feelings, execute according to strategy.
3. Within the circle of competence: Only trade what you understand, avoid noise.
4. Decisive stop-loss: No averaging down, no holding positions, exit upon loss.
5. Focus deeply: Master one method, integrate many; expand only after stability. These five iron laws are survival rules I have earned at the cost of liquidation. I hope you, who read this article, will no longer become prey to the market and ultimately become a player who controls the game.