Most people only endure when faced with being trapped, unaware that there are more scientific ways to break free. You stay up late watching the market for precise bottom fishing, yet the market continues to plummet. Once your position is trapped, should you cut losses, average down, or ignore it? 90% of people make the wrong choice, ultimately ending in liquidation. Today, I will share the techniques used by professional traders to break free; mastering these can not only turn danger into safety but even potentially reverse losses.

First trick: Distinguishing between "true trap" and "false trap"

True trap: When the trend completely reverses, such as breaking key support on the weekly chart, you must immediately stop loss.

False trap: It's just a short-term shakeout, like a quick spike followed by a rapid recovery, you can wait for a rebound.

Technique: Use "multi-timeframe resonance" to judge; look at the overall direction on the 1-hour chart, find entry opportunities on the 15-minute chart, and closely monitor reversal signals on the 5-minute chart.

Second trick: Dynamic averaging down (many people average down incorrectly)

Incorrect approach: Averaging down after a 10% drop, resulting in increasing losses and ultimately leading to liquidation due to heavy positions.

Correct approach:

1. Only average down at key support levels.

2. Each averaging down amount should not exceed 50% of the original position.

3. After averaging down, bring the average price closer; when it rebounds to near the cost price, first reduce half of the position.

Case study: A certain coin dropped from 1U to 0.7U, averaging down at the support level of 0.65U, and reducing the position when it rebounded to 0.8U, successfully breaking free and making a profit of 15%.

Third trick: Hedging magic (90% of people don't know)

When you find that the trend may continue to decline, but you don't want to stop loss:

1. Open a reverse contract in equal quantity; for example, if your long position is trapped, open a short position to hedge.

2. Set the take profit for the short position equal to the cost price of the long position, so that you can break even regardless of whether the market rises or falls.

Advanced play: Use options for hedging, which is cheaper and more efficient.

The core of breaking free is to protect the principal. If your position exceeds 50%, it's advisable to first cut losses by 50%, and then use the methods mentioned above for the remaining portion. #币圈 #BTC再创新高