My cryptocurrency trading method is very simple and practical; I reached eight figures in just one year, focusing only on one pattern and entering the market only when I see opportunities. No pattern, no entry.
Trading, maintaining over 90% win rate for five consecutive years!
A detailed analysis of the four stages of the bull market.
Stage One: Rebirth (January 2023 - January 2024) In this stage, the fatigue of the bear market* envelops the entire cryptocurrency industry.
The market is filled with a cold atmosphere. The previous collapse of the bear market is still the focus of attention for investors and media, and layoffs continue to be held.
However, just in this seemingly low-key environment, prices have quietly rebounded, and Bitcoin* prices have tripled. But most
Investors, due to previous losses in investments, have hardly noticed this change. Only those who have gone through two or more weeks
Veteran cryptocurrency investors with sharp market insights realize that the bull market has quietly begun. However, for the big
For most, they still do not believe that the bull market has started and remain immersed in the shadow of the bear market.
Stage Two: Excitement (February 2024 - Early November) Starting in February 2024, the market enters the excitement stage. Some coins
The prices of various kinds are close to historical highs, and market stories are starting to return, but only a few each quarter. In the field of cryptocurrency, large
Everyone knows that a bull market has arrived, but strangely, friends outside the industry do not pay much attention to it. The phenomenon of layoffs has basically concluded.
However, just in this seemingly sluggish environment, prices have quietly risen, and Bitcoin's* price has tripled. But most
For most people, they still do not believe that the bull market has started and remain immersed in the shadow of the bear market.
At this stage, investors' lives are still fairly good, and cryptocurrency investors are starting to profit. This is like the calm before the storm.
Calmness; the market is brewing greater changes.
Stage Three: Euphoria (started after the presidential election on November 5) Currently, we are in the euphoria stage. This stage started on November 5.
After the presidential election officially begins, it is a delightful moment. Almost every investor is making money, but speculators have not yet surged.
Each new market story is emerging as now there are new stories every week.
New market stories are emerging, and now there are new stories every week.
Stage Four: In the end, new stories may emerge every day. In this stage, the market presents a complex emotional state of extreme optimism about the market's rise while also worrying that this is just a temporary rebound. Overall, however,
groups, every new idea is seen as a 'good' idea, and anyone with followers is considered a genius; they all have their own stories about new market narratives.
Personal insights. There will always be someone making money on popular cryptocurrencies this week and will boast without reservation. This can easily trigger other investors' feelings.
The 'fear of missing out' (FOMO) in investors, seeing others making money while they missed opportunities, can lead to frustration.
A few truths about trading cryptocurrencies:
1. Patience is the first element of trading cryptocurrencies.
2. There are no coins that rise indefinitely; sticking to the first rule will always give you opportunities to buy cost-effective coins.
3. When retail investors swarm in, the peak has already been reached; at this point, consider reducing positions.
4. Focus on a few core tracks; each track can have a few coins to hold until the end of the bull market.
5. Stay away from contract leverage*; stick to spot investments*;
6. Buy when no one cares; sell when everyone is talking;
7. Always keep a portion of U+ for emergencies.
8. Maintaining liquidity in assets is very important;
9. Small wealth relies on diligence; large wealth relies on understanding.
10. Do not attempt to seize all opportunities; just seize the ones within your understanding.
No more nonsense!
Sharing my trading strategies and insights with friends. There’s a saying, standing on the shoulders of giants saves ten years of effort. If you are lucky enough to see this,
Friends who want to improve their cryptocurrency trading skills must read more, study carefully, and it's recommended to save!
Three points to note about trend lines: First, three points make a line. If three points cannot form a line, then delete that line from your chart, okay? Do not draw it; do not let meaningless things interfere with you. A trend line must be validated three times to be used. What does validation mean? It means that the candlestick touches the trend line as if it touches a 'high voltage line', either bouncing up or dropping down. Validating requires touching three times. Of course, it does not have to be limited to three touches; our principle is that the more touches, the better. (As shown in Diagram One)
Trend lines connect the lower track in a downtrend and the upper track in an uptrend. (As shown in Diagram Two)
Second point: The larger the cycle, the more effective it is; this is easy to understand. Finding trend lines on the 4-hour chart is definitely better than finding trend lines on the minute chart.
Third point: Connect bodies, not shadows; try to connect bodies, do not connect shadows.
After discussing the method of drawing trend lines, let’s summarize two common mistakes that beginners often make when drawing trend lines.
Diagram Three
The first type is that many people like to connect two points when drawing trend lines and then wait for the price to validate the trend line for the third time. So, is this method effective? Of course it is. But when validating for the third time, for example, if there is currently an upward trend (as shown in the third diagram), and if it looks like this during the third validation, then this trend line can be retained; it is valid, and we can continue to refer to it later.
(Diagram Four)
But if the price is at this position, meaning it directly goes down when it touches the trend line for the third time (as shown in Diagram Four), and then it pulls back, then you ask, Coach, is this trend line valid? I think it is invalid because this trend line does not satisfy the three-point line condition. Although it seems to touch the trend line at this point, it also violates the purpose of drawing this trend line, which is to look for buying opportunities. If this trend line cannot give you a signal to buy, what use is it?
(Diagram Five)
The second type is not being able to distinguish between real and false breakouts. For example, if a pin appears at this position (as shown in Diagram Five) and it touches the trend line you drew, then you believe this trend line is invalid. But if it were me, I would consider it a false breakout. I would ignore that false breakout position and treat it as if I didn't see it.
To sum up, the method of drawing trend lines is actually very simple:
First: At least three validations.
Second: The larger the cycle, the more effective it is.
Third: Try to connect bodies; do not connect shadows.
Trend lines are actually not much to talk about; in simple terms, they help us judge whether the current trend is upward or downward. The key is that we want to understand the Dow Theory's 123 rule through trend lines because this 123 rule is the essence of Dow Theory. Many people make money through it, and they have made money, so this 123 rule is very useful. Trading on the right side, once you learn it, you can also make money.
Back to the point, what is the 123 rule?
Step 1: Break the line.
Step 2: Do not break the previous high or say do not break the previous low.
Step 3: Break through the previous high or break through the previous low.
(Diagram Six)
This is the definition of the 123 rule. Doesn’t it sound very simple? Moreover, the order of these three steps can be adjusted freely, meaning that it can also be ‘not breaking the previous high first, then breaking the line, then breaking the previous low’. So what is the use of the 123 rule? It helps us judge whether a trend has reversed. If we determine that a trend has reversed, then we can make the reversal; this is the greatest usefulness of the 123 rule. Let’s look at this diagram. (As shown in Diagram Six)
How to use the 123 rule.
2
A while ago, we talked about the 2B rule, so today let's discuss the 123 rule.
This is the definition of the 123 rule. Doesn’t it sound very simple? Moreover, the order of these three steps can be adjusted freely, meaning that it can also be ‘not breaking the previous high first, then breaking the line, then breaking the previous low’. So what is the use of the 123 rule? It helps us judge whether a trend has reversed. If we determine that a trend has reversed, then we can make the reversal; this is the greatest usefulness of the 123 rule. Let’s look at this diagram. (As shown in Diagram Six)
This is an upward trend, so let’s first draw a trend line; three points make a line, and then look at Step 1: breaking the line, where the price breaks the upward trend line at this position; this is Step 1.
Step 2: Do not break the previous high or low; for an upward trend, it means not breaking the previous high at this position.
Step 3: Breaking through the previous high or low is at this position; for an upward trend, breaking through is actually the previous low. The point that breaks is the low point that creates the high point, which many people cannot find; this previous low point refers to the low point that created the high point.
Breaking the line is at this place; not breaking the previous high is at this place; breaking the previous low is at this place. This order is actually 132, which is shifting from long to short.
(Diagram Seven)
So, in a downward trend, how can we know when this decline has ended and the market is about to reverse? Also (as shown in Diagram Seven).
Step 1: Break the line; of course, this order can be reversed. Then do not break the previous low, and then break the previous high; this is from short to long.
(Diagram Eight)
Learn the 123 rule; then may I ask, would you go long here? (As shown in Diagram Eight) Others can, but you cannot!
(Diagram Nine)
Although we discussed earlier that the 123 rule can identify trend reversals, the purpose of identifying trend reversals is not to make counter-trend trades, but to ride the big trends and counter the small ones, still illustrated by the shift from short to long. (As shown in Diagram Nine)
Aren't you looking to shift from short to long? In simple terms, don't you want to take advantage of this upward move? Then you must ensure that there is a larger upward trend ahead; you need to ensure that there is a larger trend to follow. Do you understand? Go with the big, against the small. This is the essence of the Dow Theory's 123 rule, because we say that Dow Theory is essentially trend trading; thus, although the 123 rule can identify trend reversals, you cannot make reversal trades or counter-trend trades.
To help everyone understand better, let’s take an example of shifting from short to long.
Case One
Go to the larger timeframes, such as the daily chart for Bitcoin (Case One), and as a rule, the chart cannot exceed 250 candlesticks. If I want to take profits from this decline, then I cannot directly use the 123 rule to reverse it. Instead, I need to ensure that there is a larger upward trend ahead for us to follow, so that we can confidently reverse this decline.
Now this condition is met, but we find that this decline is not so obvious on the daily chart. We can switch to a lower level of the daily chart, which is the 4-hour chart, and this decline becomes very obvious. Now we switch to the 4-hour chart to use the 123 rule to reverse this downward trend.
This is a case of shifting from short to long, so to summarize, we learn the 123 rule not to make counter-trend trades but to 'ride the big and counter the small'. Due to time constraints, I will not provide further examples. Alright, that’s all for today. If you have learned and understood today’s content, it is no exaggeration to say that you now have the ability to profit in the trading market.
(Diagram Twenty-Three)
However, I still want to emphasize one point here: although the 123 rule is useful, you must consider your position, direction, entry point, stop-loss point, take-profit point, strategy, and so on before entering the market. In simple terms, it’s about having a trading system so that you can achieve stable profits.
The 15 'must-sell' iron rules shared today are the essence of my years of practical experience. No boasting, no empty promises; as long as ordinary people strictly implement them, they can avoid 90% of loss traps.
1. Eat fish only in the middle section; leave the head and tail for others.
Don't fantasize about buying at the lowest point or selling at the highest point. The main upward trend is your profit zone; greed at the beginning and end will only trap you.
2. Not stopping losses = chronic suicide.
No matter how good a coin is, if it breaks key support, decisively cut losses. If the capital is gone, nothing is left.
3. Newbies watch prices, experienced traders watch volume, and experts watch trends.
Candlestick patterns can deceive, but volume and major trends do not lie.
4. Only play familiar coins; unfamiliar projects = high risk.
If you don’t even know who the project team is, why believe it can rise? Investing in old friends is steadier than betting on new trends.
5. Buy quickly, hold steadily, and sell decisively.
Hesitating to buy = missing opportunities; selling randomly = losing profits; execution determines returns.
6. Opportunities arise from declines; cash is accumulated over time.
Without bullets, no matter how good the market is, it has nothing to do with you. Patience in waiting is the highest-level strategy.
7. Technology is a tool; mindset is the way.
No matter how good the technical indicators are, they cannot compete with a brain dominated by FOMO.
8. The market often starts in despair and ends in madness.
When others panic, be greedy; when others are greedy, retreat. **Only by going against human nature can one win.**
9. Greed destroys profits; fear destroys opportunities.
Made 10 times but want 20 times? Afraid to add positions after a 30% drop? Without controlling emotions, you will eventually be harvested.
10. Make small money in the short term, big money in the long term, and quick money in the swing.
Find a rhythm that suits you; do not blindly follow the crowd for day trading.
11. When others panic, you buy; when others are crazy, you sell.
The busiest times in the market are often the most dangerous. Independent thinking is the only way to outperform the crowd.
12. Relying on luck to make money? It’s better to buy a lottery ticket.
Investing is not gambling; **luck equals self-destruction.
13. In a downward trend, do not go all in; keeping cash = keeping opportunities.
Do not fear missing out; fear being trapped. Position management is more important than choosing coins.
14. Frequent trading = chronic blood loss.
Trading ten times a day? Exchanges will laugh, but your capital will cry. Experts wait for opportunities, not chase them.
