In my first two years of trading crypto, I lost a lot and doubted my ability. But after enduring that dark period, I've achieved stable profits for nearly three years.
Actually, making money from trading isn't that complicated; the key is finding the right methods. Today, I'm sharing the 3-step profit method and 8 iron rules I've summarized from my experiences. The content is brief but highly valuable. If you think it doesn't make sense after reading, feel free to say whatever you want!
Thousands of once-happy families end up ruined, often due to pursuing the unattainable dream of making a fortune in crypto. Some ask if it’s possible to get rich overnight in crypto. From a probability standpoint, yes, but the odds are extremely low. The stock market has a 7% loss, 2% break-even, and 1% profit; the crypto space is even harsher, with over 90% of people being there to lose. Yet, due to human greed and luck, there are always those who believe they will be among the lucky 10%.
5 common ways traders get wrecked, avoid these pitfalls to survive.
If you want to survive in the crypto space without getting wrecked and share in the profits, you must remember these 5 common ways to get wrecked. If you fall into two of them, you may very well become a victim!
The dealer runs off: LUNA dropped from $100 to $0.00001 within days, and FIL also fell from over $200 to $5. Such examples are not rare. Many projects first inflate the coin price to a high, and when the dealer thinks the time is right, they continuously unload to cash out, leaving the followers who entered late mostly getting wrecked. Almost all listed coins are like this; the project's goal is to make money, and the so-called vision is just something to tell the retail investors and latecomers.
Exchange run-offs: It's common for small exchanges in crypto to run off. Once they do, your assets could be wiped out completely. Even among the top five exchanges, rankings often change, and those below the fifth are particularly unreliable; they can shut down or run off at any time. Last year, the top three U.S. exchange FTX went bankrupt and liquidated in just a few days. After small exchanges run off, retail investors often find themselves in dire straits, feeling hopeless.
Self-theft: Some small exchanges and wallets, while clearly having hacked your coins, falsely claim they were hacked by outsiders, which is really infuriating. New retail investors are easily harmed by these unknown exchanges and wallets.
Addiction to contracts: Trading contracts is a consensus among crypto investors for losing money. A big bullish candle attracts countless people to enter; a big bearish candle leaves retail investors silently in tears. Most who trade contracts aim to get rich quickly, often using high leverage and gambling mentalities. But even if you win 9 times, losing just once can wipe you out. Many small exchanges can even manipulate price movements, and occasionally large exchanges might also operate manually to blow up major players, so high-leverage contracts should definitely be avoided.
Blindly chasing altcoins: In some groups, so-called team leaders promote when a coin will be listed on exchanges, claiming it can rise dozens or hundreds of times in a short period. There are people in the group sharing their profits, making you feel compelled to buy after being brainwashed. The coin might indeed go up briefly on a small exchange or a self-built app, initially attracting more people to enter or encouraging you to increase your position. But once you invest more, a sharp drop may occur, trapping you until you cut losses, at which point it might rise. The operators might even know your position and just wait for you to sell at a low price. Worse still, the dealer only sells and does not buy back; as soon as it hits the exchange, it drops. The more you buy, the more it falls, leaving you with no chance to recover your investment.
Key points of the 3-step profit method and the 8 iron rules.
I've tried 90% of the technical methods in the market and fallen into all the traps, but the most practical remains the RSI indicator. The RSI indicator is a must-have skill for short-term and swing trading; it’s simple and practical, and it's considered a 'dummy' method, but often the simpler methods are the most profitable and applicable in both contracts and spot trading.
The 3 steps to making money are actually quite simple: Step 1, learn to recognize the 5 ways to get wrecked mentioned above and avoid the pitfalls; Step 2, master the use of the RSI indicator to identify buy and sell points; Step 3, strictly follow your trading plan and do not be swayed by emotions.
The 8 iron rules are even more crucial.
Never invest all your assets in the crypto space; only use idle money that won't affect your life if lost.
Avoid small exchanges and only choose a few reputable leading exchanges.
Maintain respect for contracts; leverage should never exceed 3 times, and ideally avoid contracts altogether.
Be extremely cautious with altcoins; do not invest more than 5% of your total funds.
Learn to read the RSI indicator, sell decisively when overbought and buy cautiously when oversold.
Set stop-loss and take-profit levels, execute decisively when reached, without hesitation.
Don't follow the crowd blindly; no matter how good others say it is, you must do your own research.
Keep learning; the crypto space changes rapidly, and only by continuously improving your understanding can you avoid being eliminated.
There are indeed opportunities in the crypto space, but it is also fraught with traps. Mastering these methods and iron rules may not guarantee overnight riches, but it can help you survive longer in this market and increase your chances of sharing in the profits. If you find this content helpful, feel free to follow me.
