I've seen people buy Bitcoin for $100, then rush to sell when it rises to $500, only to watch it soar to $60,000; I've also seen someone build a position in Ethereum at $200, endure a 40% drop without selling, and ultimately turn that portion into ten times the investment. The harsh truth in the crypto world is: 90% of people lose because they can't hold onto low-price chips, while the 10% winners are quietly doing these few things.
Let's first discuss why low-cost chips are more precious than gold. Last year, a fan sold off during FIL's drop to $5, reasoning that 'there's no hope.' Three months later, it rebounded to $20. He later told me, 'I was afraid it would drop further; now I realize the market makers were trying to trick me into selling my low-cost chips.'
The market makers' tricks are merely to create panic through trades and force you to cut losses. As long as your holding costs are low enough, even large fluctuations won't hurt your principal; it's like having supplies during a war; you won’t panic.
But having low-cost chips is not enough; you also need to master the skill of 'building and unloading positions.'
I now use the 'price segment accumulation method': for example, if Bitcoin's current price is $30,000, I will leave 20% of my funds at three price levels: $28,000, $25,000, and $22,000.
Buy more when it reaches the corresponding price; don't buy if it doesn't drop. This way, you can avoid chasing highs and acquire cheaper chips during corrections. Last year, when Bitcoin fell from $40,000 to $28,000, I used this tactic to buy in two batches, directly lowering my cost by 15%. When it rebounded to $35,000, I was already in profit.
Selling requires skills as well. During a rapid rise, don't think about 'selling at the highest point.' I usually sell half when I have a 30% profit, and set a trailing stop-loss for the remaining half. For example, if Ethereum rises from $1,600 to $2,000, I take 50% profit, and set the stop-loss for the remaining at $1,800. Even if it pulls back, at least I've preserved most of my gains. Those who always want to 'sell at the peak' often end up turning profits into losses.
It's even more crucial to understand the 'signals of market linkage.' When Bitcoin drops, mainstream coins typically follow, but the extent of the drop varies: some stabilize after a 10% drop, while others can fall 30%. At this point, you need to see 'who is resisting the drop.' Last year, when LUNA crashed, Bitcoin dropped 15%, but Ethereum only fell 8%. This is a signal that funds are seeking safety.
At one point, I exchanged half of my altcoins for Ethereum, avoiding the subsequent chain of crashes. Remember, for popular coins look at sentiment, for value coins look at support. Maintain a 30-70 ratio between the two; it allows you to ride the wave while mitigating risks.
The core of fund management can be summed up in one sentence: "The market has coins, the account has money, and the pocket has cash." I've seen the most stable old players always keep 30% cash on hand. When Bitcoin drops significantly, they can use cash to average down; when a good project comes along, they have funds to allocate; even if the market crashes, the cash in their pockets allows them to hold on until the next opportunity.
In contrast, those who go all-in either face liquidation or miss the bottom-buying opportunities, ending up with no funds and unable to seize chances when they arise.
Let me give you 9 principles for guaranteed profits. If you can master 6 of them, you'll surpass most retail investors:
Invest with spare money; borrowed money will force you to make hasty decisions. I used to swipe my credit card to buy coins, couldn't sleep when it dropped 10%, and ended up cutting losses while still in debt. This is a bloody lesson.
Don't rush to build a position; divide your purchases into 3-5 batches. For example, if you are optimistic about a certain coin, buy 20% of your position first, then buy another 20% if it drops 10%, buying more as it falls but not exceeding 50% of your total funds.
When profits increase, take the 'cash out for safety' approach; don't be greedy. My current rule is: if a single coin has a profit over 50%, I must sell 30% to recover my principal.
Don't panic during a sharp drop; first look at the support levels. How many people sold at the floor when Bitcoin fell below $20,000? Just check the previous low support levels, and you’ll know this is the time to average down, not cut losses.
Don't listen to 'insider information'; original judgment is often the most accurate. Last year, someone told me a certain coin was going to a major exchange, and I believed it and bought in, only to find out it was a market maker selling off. Later, I realized my initial technical analysis had already indicated the risks.
Go with the trend; don’t go against it. No matter how strong a coin is during a bear market, it won't outperform the overall market; conversely, even the worst mainstream coin can benefit during a bull market. Operating against the trend is like going against your money.
Start with a light position to test, and add to your position once you're in profit. For new coins, start with a 5% position; if it rises and meets expectations, gradually increase to 10%. Never go in heavy right away.
News must be viewed in conjunction with technical analysis. If a coin has good news but doesn't rise, it might be that the market makers are using the good news to sell; if there is bad news but it doesn't drop, it could actually be a bottom signal.
Spend 10 minutes every day writing a trading journal: reasons for buying, emotions at the time, reflections after ups and downs. After three months, you'll find yourself repeatedly making the same mistakes.
Finally, I want to say that the true experts in the crypto world are not those who can precisely predict ups and downs, but those who can hold low-cost chips and manage their funds well. Early on, rely on low-cost chips as a base; in the mid-term, profit from price fluctuations; in the long term, have the patience to wait for cycles — this is the key to navigating through bull and bear markets.