When I first entered the crypto space, I made about 4 million with a capital of 50,000. I graduated from college without ever having worked.
I have been playing in Kunming and Dali, not buying houses or cars. Monthly expenses are 1500.
How I made money:
1. With a capital of 50,000, I did projects in college, affiliate marketing, completing tasks, deliveries, and app promotions, and saved up 50,000.
2. Entering the crypto space, I think BTC is too expensive, so I just play with ETH+, which has leverage, and then some altcoins. Choose coins and manage positions well. Just execute the simple strategy continuously, if the market is bad, you may incur a small loss, but when the market comes, you can make a lot.
Why enter the circle: If you want to change your fate, you must try the crypto space. If you can't make money in this circle, ordinary people will have no chance in their lifetime.
As someone who has gone through three rounds of bull and bear markets, I can tell you: the following three things are what you should never do in the crypto space.
1: Don’t touch contracts, don’t hold positions, don’t chase after low-quality coins.
2: The worst thing you can do is frequently buy and sell, chasing highs and cutting losses.
3: The worst thing you can do is put all your coins in one wallet address or exchange; it's even riskier than playing with leverage in futures. Below, I will provide you with solid advice on what you should do in the crypto space.
In trading coins, mindset is even more important than technique. Make money in a bull market, accumulate coins in a bear market, don’t cut losses in a bull market, and hold coins in a bear market!
1. Coin accumulation method: Suitable for both bull and bear markets. The accumulation method is the simplest yet the most challenging strategy. It is simple because it involves buying a certain coin or several coins and holding them for more than six months or a year without trading. Generally, the minimum return is tenfold. But beginners often see high returns or encounter price halving, leading them to consider switching to another investment or exiting. Many find it hard to stick to not trading for even a month, let alone a year. Thus, this is actually the hardest part.
Note: Accumulating EOS and ADA is fine, or take out some money each month, as long as it doesn’t affect your life, and stick to dollar-cost averaging.
2. The bear market dip-chasing method: Only suitable for bull markets. Use a portion of spare cash, preferably no more than one-fifth of your capital. This method is suitable for coins with a market cap between 20-100, as they shouldn't be stuck for too long. For example, if you buy the first altcoin and it rises by 50% or more, you can then switch to the next coin that has fallen sharply, and so on. If your first altcoin gets stuck, just wait; the bull market will definitely allow you to get out. The premise is that the coin cannot be too troublesome; this method is not easy to control, so beginners should be cautious.
Note: When buying, make sure to ask an expert if it’s at the bottom; if it’s at a high point, it’s generally difficult to make a profit, and beginners often end up cutting losses. Be sure to note that the market cap should be between 20-100, and additionally, invest no more than one-fifth of your total capital.
3. Hourglass trading method: Suitable for bull markets. In a bull market, buying almost any coin will increase in value. Capital acts like a giant hourglass, slowly seeping into each coin, starting from the major coins. There is a clear pattern where leading coins rise first, such as BTC, ETH, DASH, ETC, followed by mainstream coins like LTC, XMR, EOS, NEO, QTUM, etc. Then, lesser-known coins rise collectively, such as RDN, XRP, ZEC, etc., followed by various smaller coins taking turns to rise. But if Bitcoin rises, you should select the next level of coins that haven’t risen yet and start building your position.
4. Pyramid bottom-fishing method: Suitable for anticipated major drops. Bottom-fishing method: Place orders to buy 10% of your position at 80% of the coin price, 20% at 70%, 30% at 60%, and 40% at 50%.
Note: This type of bottom-fishing requires very precise judgments about the price level you want to buy at.
5. Moving average method: You need to understand some basic candlestick patterns. Set indicator parameters as MA5, MA10, MA20, MA30, MA60, and choose a daily chart. If the current price is above MA5 and MA10, hold. If MA5 falls below MA10, sell the coin; if MA5 rises above MA10, buy to build a position.
Note: For beginners, being able to learn to read candlestick charts is already a step up from being a novice.
6. Violent accumulation method: Focus on coins you are familiar with; suitable only for high-quality long-term coins. With a certain amount of liquid capital, if a coin is currently priced at 8 USD, place a buy order at 7 USD. Once the buy order is executed successfully, place a sell order at 8.8 USD. Use the profits for accumulation. Withdraw the liquid funds and continue waiting for the next opportunity, adjusting dynamically according to the current price. If there are three such opportunities in a month, you can accumulate a lot of coins. The formula is: entry price equals current price times 90%, sell price equals current price times 110%!
Note: Sudden price surges and drops happen in an instant, so this method is fundamentally based on placing orders.
7. The ICO violent compound interest method: Continuously participate in ICOs; once a new coin has risen by 3-5 times, take back the principal and invest in the next ICO, keeping the profits and continuing the cycle.
Note: Beginners should consider joining a team and operate under team guidance; those who are completely ignorant participating in ICOs are akin to throwing money into water.
8. Cyclical swing method: Find coins like ETC that are undervalued; add to your position when the price keeps dropping, keep adding as it drops, then wait for profit and sell, continuing the cycle.
The above methods are suitable for beginners; I recommend studying them slowly! Choose the methods that suit you. After building your position, hold it steady. Don’t sell if you’re not making money; if you’re stuck, you need to hold steady and not cut losses.
There is a 'foolproof' way to trade coins, simply follow the market makers and reap the rewards! Share this with those who see this article.
In day trading, chart patterns can help you grasp price trends. But sometimes these patterns may appear to be illusions, so how can you trust them to guide your trading decisions?
The reliability of chart patterns is not just about recognizing shapes; it is a comprehensive judgment woven from historical data, volume analysis, and market psychology. You will find that the most trustworthy chart patterns are those supported by solid evidence and sustained performance.
As you delve deeper into this topic, you will discover the key elements that distinguish reliable chart patterns from coincidences, and how mastering these elements can significantly impact your trading strategies.
Historical data and pattern recognition
A large amount of historical data forms the basis for recognizing chart patterns in day trading. When analyzing price movements, you are actually leveraging years of market behavior.
These historical patterns help shape the strategies that traders use today.
To understand why chart patterns are reliable, you need a certain level of data analysis ability. It’s not just about recognizing shapes on the chart; it’s about verifying these patterns through statistical significance.
This means you need to examine how likely a certain pattern has historically led to predicted movements.
Market trends also play an important role in this process. You need to consider how the performance of chart patterns will change in different market environments. To do this, you need to gather reliable market data across different stages of the market.
Are certain patterns more reliable in a bull market (uptrend)? Or do they have more predictive value in a bear market (downtrend)?
This analysis method forms the basis of predictive modeling, which essentially attempts to predict future price movements based on past behavior.
Volume confirmation and support roles
When analyzing chart patterns, volume confirmation becomes a key factor in validating potential trading signals. When observing price movements, pay special attention to volume, as it can provide important information about the strength of a pattern.
During the formation of patterns, if volume increases, it often indicates heightened trader interest, suggesting that the pattern may be more reliable.
You need to pay attention to volume spikes that correspond with key price movements. For example, when you observe a breakout of a chart pattern, if the price breaks through resistance while experiencing a surge in volume, it may confirm the validity of that move.
Conversely, if the volume is low during the breakout, the move may fail. However, if there is a volume increase after the breakout, that is also a phenomenon we want to see, regardless of the volume during the breakout.
Support levels in chart patterns are the foundation of price analysis. These price points are often where buying pressure exceeds selling pressure, leading to price rebounds. When you notice chart patterns forming near a strong support/resistance level, it adds confidence to your trading decisions.
Consistency in time frames
When analyzing chart patterns, maintaining consistency in the chosen time frame is crucial for accurate interpretation. You need to consistently use a specific time frame, whether it's 5 minutes, 15 minutes, or hourly charts.
This consistency helps you better identify the coherence of trends and the strength of signals within different patterns.
When you switch back and forth between different time frames, you may miss important details or misjudge the overall trend. For example, a bullish pattern that looks good on a 5-minute chart may actually be part of a bearish trend in a larger time frame's pullback. By maintaining consistency in time frames, you will gain a deeper understanding of how chart patterns form and evolve within that period.
However, also remember that any time frame can become a dominant force at any moment. For instance, reversals on daily charts often start from reversals on lower time frames.
At the same time, you should consider whether the time frame you choose aligns with your trading strategy. If you are a short-term trader (like a scalper), shorter time frame charts such as 1-minute or 5-minute may be more suitable for you.
For swing traders, longer timeframes like 4-hour or daily charts may be more suitable. Remember, the key is to find a time frame that fits your trading style and consistently stick to it.
Market psychology and behavior
Understanding market psychology and behavior is fundamental to successfully analyzing chart patterns. As a day trader, you will quickly realize that charts are not just combinations of lines and shapes; they reflect the emotions of traders and the overall sentiment of the market.
Behavioral finance tells us that trading decisions are often influenced by cognitive biases, making chart patterns more complex than mere technical indicators.
To understand the psychological factors in chart patterns, consider the following points:
◔ Psychological support and resistance levels often coincide with important chart patterns.
◔ Group psychology plays an important role in the formation and breakout of patterns.
◔ Fear factors may trigger sudden reversals or breakouts in patterns.
◔ Traders' confidence at certain price levels can reinforce existing chart patterns.
You will notice that certain patterns recur because they are rooted in human nature. For example, the 'double top' pattern typically forms when traders' initial confidence begins to wane, leading to a price pullback.
When studying chart patterns, pay attention to the underlying market sentiment. Are traders optimistic or cautious? Is there a fear of missing out (FOMO) or loss aversion in the market? These emotional factors often determine how prices behave within the patterns you observe.
Technical indicators and confluence analysis
When analyzing chart patterns, it is very important to combine multiple technical indicators.
This method is called indicator confluence analysis, and it can help you more accurately identify potential trends and reversals.
Indicator confluence analysis
Combining multiple technical indicators can significantly enhance your trading decision-making ability. This method improves the reliability of signals by corroborating multiple indicators, thereby strengthening the overall effectiveness of your analysis.
When multiple indicators show consistent signals, the signals they provide are generally stronger, thus reducing the risk of misjudgment (false signals). You will find that this approach helps you make more informed decisions in day trading.
To effectively utilize indicator confluence analysis, you can follow these steps:
◔ Choose complementary indicators that reflect different dimensions of the market;
◔ Before making trading decisions, look for consensus signals among multiple indicators;
◔ Pay attention to divergences between indicators, as this may signal potential trend changes;
◔ Combine leading and lagging indicators for more comprehensive market analysis.
Divergence and confirmation
Based on the concepts of indicator confluence, divergence, and confirmation, these play a key role in technical analysis. When analyzing charts, you often encounter bullish divergence and bearish divergence. These situations refer to inconsistencies between price movements and technical indicators.
The core of divergence analysis lies in identifying the discrepancy between price action and technical indicators. Common types of divergence mainly include: classic divergence and hidden divergence.
To enhance the effectiveness of divergence trading strategies, it is recommended to use multi-timeframe divergence analysis. This method compares divergence situations across different time frames, providing a more comprehensive market perspective.
Divergence in oscillators is especially worth paying attention to, as tools like RSI and MACD often show signals inconsistent with price behavior.
When you notice price divergence, do not rush to enter a trade. Be sure to wait for confirmation signals from other indicators or chart patterns. Remember, divergence itself is not 100% reliable, but when combined with other analysis methods, it can effectively enhance the quality of your judgment in day trading.
Breakout and reversal signals
In day trading, identifying breakout and reversal signals may be key to your success.
You need to learn to identify breakout patterns that occur when price breaks existing support or resistance levels.
Additionally, understanding reversal signal indicators (such as specific candlestick patterns or divergences in technical indicators) can help you anticipate potential changes in price direction.
Identifying breakout patterns
In day trading, breakout patterns serve as important signals for predicting price movements and trend reversals. To identify reliable breakout patterns, you need to consider multiple key factors.
First, observe the strength of the breakout and the duration of the pattern. Generally, longer-lasting patterns tend to trigger more significant breakouts.
Next, pay attention to spikes in volume, as this can confirm the validity of the breakout. Also, check if this breakout aligns with the overall market trend.
To enhance your ability to identify breakout patterns, you can follow these steps:
◔ Study historical charts to become familiar with common breakout patterns;
◔ Practice in a demo account in real-time to identify potential breakout signals;
◔ Keep a trading journal to record your observations and trading results;
◔ Analyze successful and failed trades to continuously optimize your trading strategies.
Reversal signal indicators
Reversal signal indicators are a strong complement to breakout patterns, providing further confirmation of potential trend changes. These indicators are important tools for identifying possible shifts in market direction, helping you grasp market sentiment and price behavior.
When analyzing charts, pay attention to the following common reversal signals: double tops, double bottoms, and head and shoulders patterns. These structures reflect trader psychology and may indicate an imminent trend reversal.
To improve the reliability of patterns, you can combine reversal signals with other technical indicators or breakout strategies. This combination enhances your ability to assess risk-reward ratios and make more informed trading decisions.
Remember that emotional control plays a decisive role in trading. When you identify potential reversal signals, do not let excitement or fear affect your judgment.
Volatility analysis is also an important factor in identifying reversals. Most significant trend changes are usually preceded by high volatility, so pay attention to moments of sharp price fluctuations.
Finally, pay attention to the timing of entry. Before entering a trade, be sure to wait for a clear reversal confirmation signal. This patience helps you avoid misjudging signals, thus improving overall trading performance.
Risk management and stop-loss
Risk management and stop-loss mechanisms are the cornerstones of successful day trading. They are crucial for protecting your trading capital and achieving long-term stable profits. When developing a trading strategy, you must consider your risk tolerance and apply appropriate position control and money management techniques.
To effectively manage risk and set stop-loss orders, please follow these key steps:
◔ Assess market volatility to determine appropriate stop-loss levels;
◔ Calculate the maximum allowable loss for each trade based on your risk tolerance;
◔ Use loss ratio control to adjust position size based on market conditions;
◔ Establish clear exit strategies and profit targets for each trade.
Emotional discipline in trading is crucial for adhering to your risk management plan. While it’s easy to be swayed by emotions during trading, you must always stick to your preset stop-loss and exit rules. By doing so, you can avoid significant losses while maintaining consistency in your trading strategy.
Don't forget that risk management is not just about limiting losses, but also about maximizing profits. By managing your positions and stop-loss settings rationally, you will be better equipped to seize favorable trading opportunities while effectively controlling potential risks.
Conclusion
You have learned that in day trading, chart patterns are not random shapes. When they are supported by historical data, volume, and market psychology, they become reliable trading tools. Remember to maintain consistency in time frames during your analysis and enhance your judgment with technical indicators. Always pay attention to the emotional factors driving other traders’ decisions. By combining all these factors, you will be more capable of identifying trustworthy patterns and making well-founded trading decisions. Finally, don’t forget to manage risk and set stop-loss for each trade.
By understanding these rules, you too can earn the little sun you desire in the crypto space!
1. Never buy coins when prices are high; maintain the mindset that it doesn’t matter how much it rises, pretend the coin doesn’t exist.
2. Coins can be divided into two types: coins that are good are those at buying points, and those not at buying points are trash coins; coins at major buying points are the best quality stocks, patiently waiting for them to become real high-quality stocks over time—that is the correct mindset.
3. Actually, the most important thing in trading coins is mindset. Many people know it's not the right buying point, but can't help but buy due to impatience. This indicates a problem with mindset; if this isn't resolved, no theory learned will be of use.
4. Your mindset should be stable; don't get emotionally attached to any coin or price level. Only look at the signals the market gives for buying and selling.
5. When you make mistakes, don't blame the market; only look for your own reasons. You must summarize after each mistake.
6. A mindset without technical support is a foolish mindset with no reaction. Only insights guided by wisdom can ensure a good mindset.
7. Why can't you allow yourself to be like a wolf? This has nothing to do with the amount of capital. As long as you can buy at buying points and sell at selling points, that's the most powerful thing.
8. Stay calm while trading; having money means you can find good coins, don’t fear not finding them.
9. In the market, any luck is only temporary, and the market will make you pay back double. When facing the market, unless you fundamentally change yourself, you cannot defeat it.
In the crypto space, it's a battle between retail investors and market makers; if you lack insider information and firsthand data, you can only be cut! If you want to layout strategies together and harvest from the market makers, come join us.
