More than a decade of trading cryptocurrencies, lost over a hundred in the first three years, and made back a few hundred in the following years; every penny is a lesson learned through blood and tears!
This market is always repeating the same secret: 90% of retail investors are focused on news to trade coins, 9% of smart people watch the movements of the big players, while 1% of aggressive participants are dissecting market trends using moving averages.
Step 1: Identify the moving averages. Treat the daily moving average as three distinct old doctors— the 5-day line is the emergency department head, the 30-day line is the internal medicine expert, and the 60-day line is like an old master sitting in the specialist clinic. When the emergency department head suddenly gets up and takes the pulse of the two old experts (the 5-day line crosses above the 30/60-day lines), this signals that the market is preparing to go into ICU for rescue. Conversely, if the emergency department head slips and rolls off the master chair in the specialist clinic (the 5-day line crosses below the 30/60-day lines), don’t hesitate, immediately reduce your positions.
Step 2: Establish a trading system to prevent emotional trading.
Now please stick a note on your trading interface, and write boldly with a marker: When moving averages clash, mortals retreat. When the 5-day line and the 30-day line are entangled like twisted dough, jumping into the market is like rolling dice to guess even or odd. True hunters only pull the trigger when three lines march in the same direction.
Here's a piece of counterintuitive trivia: In the volatile world of cryptocurrencies, the simpler the strategy using daily moving averages, the more lethal it becomes. Just like a true martial arts master does not need fifty starting poses; a breakthrough of the 5-day line is the signal to draw the sword, and a turn of the 60-day line is the moment to sheath it.
Step 3: Weld discipline to the trading desk.
I've seen too many people write their trading plans on napkins, only to be scared into tearing the napkin to wipe sweat when a sudden market spike occurs at midnight. The most cruel yet merciful aspect of the daily moving average strategy is that it forces you to become an emotionless signal execution machine.
Here's a piece of dark humor: A trader who consistently profited from the daily moving average strategy for three years received a 5-day line break alert at his wedding, and he had to sneak into the bathroom to close his positions before coming out to exchange rings. Afterward, the bride scolded him, but upon seeing the account balance, she silently got him a high-end monitor.
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