1. Core Strategies for Short-term Trading
1. Select Trading Targets
Focus on the top ten mainstream cryptocurrencies by market capitalization, combining real-time market trends, policy dynamics, and technical indicators for comprehensive analysis. When the daily MACD shows a golden cross, the BOLL indicator closes and then opens, and the market trend exhibits significant volatility, potential trading targets can be selected. Mainstream cryptocurrencies have strong liquidity and high risk resistance, making them more suitable for short-term trading compared to niche altcoins.
2. Scientific Position Management
Strictly implement the principles of diversified investment and position control. For example, with a principal of 50,000 yuan, divide the funds into 5 parts, each accounting for 20%, and use only one part of the funds for each position. Regardless of how attractive the market conditions are, the position share should never exceed 50%, reserving 50% of the funds as a strategic reserve to respond flexibly to exceptional market opportunities.
3. Strictly Adhere to Trading Discipline
Control the number of trades per day to a maximum of 3 to avoid risks associated with frequent trading. If the holding losses reach 30%, immediately cut losses and exit, without averaging down. At the same time, set a 30% stop-loss line for each trade; once the stop-loss is triggered, close the position unconditionally to eliminate holding behavior. Short-term trading emphasizes quick entry and exit; do not develop 'affection' for the holding cryptocurrencies, and always operate based on market signals.
2. Trading Practical Tips in the Cryptocurrency Market
Don’t Panic During Early Morning Drops: If there is a significant drop in the early morning, there is no need to rush to sell, as there often will be a rebound in the afternoon.
Reduce Positions During Afternoon Rallies: If the price rises significantly in the afternoon, it is advisable to reduce positions appropriately to guard against the risk of price pullbacks in the evening.
Distinguish Trends by Volume-Price Relationship: An increase or decrease in price while the trading volume is continuously shrinking likely means the original trend will continue, and one can trade in the direction of the trend.
Be Cautious of Profit Taking: Before major meetings or good news announcements, the market often experiences speculative trading; after the news is released, be wary of the risk of 'seeing light and dying.'
Time Zone Volatility Hides Opportunities: When there is a continuous drop during the day in China, it can be moderately monitored; at 21:30 in the evening, influenced by overseas markets, there is a possibility of a price rebound.
Exercise Caution with Spike Signals: When a K-line shows a significant 'spike,' it is necessary to judge buy and sell signals in conjunction with the overall trend to avoid blindly chasing highs and cutting losses.
High Risk in Heavy Positioning: Holding heavy positions easily leads to liquidation; avoid becoming a 'target' on the exchange’s liquidation list.
Cut Losses to Prevent Market Manipulation: If the price drops after a short position stop-loss, it is a typical market manipulation behavior; stay calm and avoid chasing.
Repeatedly Test the Edge of Exiting: When the price suddenly stagnates near the exit point, it is a common market tactic to wash out positions, which requires rational response.
Be Decisive on Profit Taking: When the expected profit target is reached, decisively take profits and exit to avoid missing the best opportunity due to greed.
Emotional Management is Key: Market sentiment is often manipulated by big players; stay calm and do not let market fluctuations sway your decisions.
Stay Alert to Bottom Temptations: When the market is broadly rising and personal funds are limited, be cautious of FOMO emotions and avoid blindly chasing highs.
