If you are new to the circle, I hope you can patiently read this article to the end.
These words are my genuine insights gained from my experience in the cryptocurrency world, not lofty principles, but lessons learned from pitfalls, profits earned, and positions endured.
First, you need to understand that you shouldn't be attached to hot coins, and you shouldn't be greedy with altcoins.
Many people see a coin that has increased several times and fantasize that it can continue to rise, only to find it drop back to square one overnight, wasting their efforts. In the past, with LUNA and FIL, it wasn't that no one reminded them, but they were too reluctant to exit. Remember: altcoins are cyclical, not everlasting. Trade and move on, don’t be greedy.
When a coin's price suddenly breaks a new high after consolidating at a high level, don't get too excited; this is often the last temptation from the main force. **You should reduce your position if necessary, don’t hesitate.** Conversely, when the price consolidates at a low level and then creates a new low but quickly recovers, it is likely the main force's last shakeout—at this point, you should be firm, don’t panic.
When the market is bad, **coins that stabilize against the trend are often the strongest; when the market is good, coins that weaken against the trend are basically unwanted.** Learn to see the attitude of funds behind the market to understand the 'language' of coin prices.
One more very important point: add positions only after making a profit; never average down when losing money.
Many people always think that when a price drops, they should average down and keep buying more as it drops, only to end up trapped. This kind of operation will only lock you into a wrong decision. The correct approach is to add positions when the coin price strongly breaks through previous highs and confirms the trend—allowing profits to continue to magnify, rather than letting losses continue to expand.
When the trend is rising, don't easily get shaken off by fluctuations. As long as the direction is correct, even if there's a short-term pullback, it's mostly a washout, following the 'two steps forward, one step back' ascending rhythm. At this time, the worst fear is not losing money, but not being able to hold on.
Many people focus on just one coin or only look at K-lines and indicators, but that's merely the surface. True experts first look at sectors and sentiment.
Wherever the hotspots are, that's where the funds will go; wherever the popularity is, that's where the explosive power lies. If you only focus on a single coin, you're second-rate; if you only focus on indicators, you're third-rate; if you look at nothing and rely solely on luck, then that's just gambling.
You should know that **technical indicators are based on 'volume' and 'price',** and they essentially still reflect the flow of funds and market sentiment. Instead of focusing on indicators like MACD and RSI to see red and green, it's better to understand the price-volume structure: an increase cannot be without volume, a decrease with volume can be lethal, while low volume often indicates false moves.
Finally, here’s a simple directional judgment thought:
In an upward trend, look for support to identify buying opportunities; in a downward trend, **look for resistance to find exit points or short positions.** Don't go against the trend, and don’t let emotions dictate your decisions.
The cryptocurrency world is a place for cultivation.
You must experience FOMO to learn patience; you must be washed out a few times to understand what a trend is; you must endure hardships to realize that stopping losses is not giving up, but leaving room for the next comeback.
May you walk slowly, but steadily.
May you take fewer detours and earn more money through understanding.
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