Practical Strategies and Short-term Techniques for Cryptocurrency Trading
In the cryptocurrency trading world, there is a method that seems 'clumsy' yet is quite effective; mastering it can steadily accumulate profits, making it worth studying in depth. First, there are three iron rules to adhere to when trading cryptocurrencies:
First, never chase high prices during a rising phase. Learn to think contrary, remain greedy when the market is filled with panic, and stay alert when everyone is blindly optimistic, cultivating the habit of buying in batches during the declining process.
Second, avoid placing pressure orders. This behavior can easily put you in a passive position and disrupt the normal trading rhythm.
Third, never operate with a full position. Full positions greatly limit operational flexibility, and the cryptocurrency market is never short of opportunities; the opportunity cost while in a full position is often astonishingly high.
Next, here are six practical short-term trading tips:
First, after the price consolidates at a high level for a period, new highs often appear; similarly, after consolidating at a low level, it frequently establishes even lower price points. Therefore, be patient and wait for the trend to clarify before taking action once the direction of change becomes clear.
Second, it is not advisable to trade during a sideways market. Most investors lose money in cryptocurrency trading precisely because they find it difficult to follow this simplest principle.
Third, when selecting candlesticks, you can follow the logic of 'buy on bearish candles, sell on bullish candles', meaning consider buying when the daily candlestick closes bearish and sell appropriately when it closes bullish.
Fourth, when the downward trend slows, subsequent rebounds will also be weaker; conversely, when the speed of decline accelerates, rebounds are often more vigorous.
Fifth, use a pyramid buying method to build positions, which is an enduring effective strategy in value investing.
Sixth, after a cryptocurrency experiences continuous rises or falls, it will inevitably enter a consolidation phase. At this time, there is no need to sell out entirely at high levels, nor to buy in fully at low levels. Because after consolidation, a change must be faced; if the market changes downwards after consolidation at a high level, one must promptly liquidate and always maintain sensitivity to trend changes.
The price often reaches new highs after consolidating at high levels and often reaches new lows after consolidating at low levels; always wait for a clear direction of change before acting; after a cryptocurrency continuously rises or falls and enters a consolidation phase, there is no need for extreme actions; timely responses are required for changes after consolidation, and if the market changes downwards from a high level, one should decisively liquidate.
