80,000 to 10 million: Practical insights in the rise and fall of the cryptocurrency world
At the beginning of 2019, when I ventured into the cryptocurrency world with an initial capital of 80,000, it happened to be the end of a bear market. At that time, Bitcoin was hovering around 3,000 USD, and everyone around me advised me not to throw money into this 'scam'. The transformation of my account's numbers today relies on the iron rules forged in the waves of ups and downs, as well as the technical analysis skills honed day after day.
I set a strict rule for myself: always invest only with idle funds, and never exceed 30% of total capital in a single cryptocurrency. During the black swan event in 2020, mainstream cryptocurrencies plummeted 40% in a single day. Because I had previously converted 50% of my position into stablecoins, I not only avoided being deeply trapped but also seized the opportunity to buy the dip and catch the subsequent rebound. On another occasion, a friend highly recommended a new coin that claimed to have 'hundredfold potential'. After my research revealed numerous flaws in its white paper, I decisively rejected it, and that coin indeed went bust within half a month after its launch.
I spend time every day studying candlestick charts, becoming thoroughly familiar with indicators like moving averages and trading volume. When the price of a cryptocurrency breaks through key resistance levels and trading volume simultaneously increases, it often signals a good entry point; conversely, when the price falls below support levels without a significant change in volume, it is highly likely to continue declining. In 2021, when Ethereum was around 2,000 USD, the 5-day moving average crossed above the 20-day moving average, forming a golden cross, while market enthusiasm was rising. I decisively increased my position, and within less than half a year, Ethereum soared to over 4,000 USD. However, technical analysis is not infallible; in 2022, there was a cryptocurrency that appeared to have a perfect candlestick pattern, but the entire market was in a panic. I restrained my impulse and did not buy in, and it indeed continued to decline.
I set my profit-taking points in three tiers, reducing my holdings by a portion when reaching 20%, 50%, and 100%, which allows me to lock in profits without missing potential further gains. My stop-loss strategy is even stricter: once a single cryptocurrency incurs a loss of 10%, I decisively liquidate my position.
In my years in the cryptocurrency world, I've seen many people become overnight millionaires, and I've also seen many others go to zero in an instant. From 80,000 to 10 million, there are no shortcuts—only the steadfast adherence to iron rules and the continuous improvement of skills. Staying clear-headed during greed and recognizing opportunities during fear is the way to gain a foothold in this ever-changing market.
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