90% of losses in the cryptocurrency market are not due to misreading the market but come from position collapse: being fully invested when trying to catch a bottom, missing out when the trend comes with a light position, and being liquidated with leverage. In 2021, I turned 50,000 USDT into 8 million, not by guessing correctly, but by using two sets of position management techniques—left-side bottom fishing to average down costs, and right-side trend chasing to lock in trends, plus a progressive position increase formula, allowing me to outperform 90% of people even with a 50% win rate.
1. Left-side position management: 'Funnel-style increasing position' for bottom fishing.
Core logic: Gradually enter before a trend reversal, using 'small losses for trial and error + increasing position on large drops' to average down costs, suitable for choppy markets and late bear markets.
Capital split formula: 50,000 USDT divided into 3 batches—20% (10,000 USDT), 30% (15,000 USDT), 50% (25,000 USDT);
Entry signal:
Batch 1 (20%): The coin price drops below the previous low but with a MACD divergence (e.g., if BTC drops from $30,000 to $28,000, and the DIF line does not create a new low);
Batch 2 (30%): A pullback of 30% with decreased volume (e.g., if ETH drops from $2000 to $1400, and trading volume reduces to 50% of the recent average);
Batch 3 (50%): Weekly candlestick forms a 'hammer' and holds above the 20-week moving average (e.g., if SOL rises from $10 to $12, with a long lower shadow on the weekly and support from the 20-week moving average).
Taboo: The interval for averaging down must be at least 10 days, and never average down unless the drop is at least 15%—in 2022, someone averaged down 5 times between BTC at $40,000 to $30,000, only to end up exhausted when it dropped to $16,000.
Case study: Before BTC started from $16,000 in 2023, I increased my position using the left-side strategy: buy 20% at $16,000, 30% at $15,000, and 50% at $14,000, resulting in a final cost of $14,800, with a yield of 102% when it rose to $30,000, earning 40% more than a full position bottom fishing.
2. Right-side position management: Trend-following 'moving average increasing position method.'
Core logic: Wait for trend confirmation before entering, using 'moving average signal + breakout pullback' to increase position, suitable for bull markets and strong coins.
Four-step increase position rule (taking ETH as an example):
Buy 1 (30% position): The 5-day moving average crosses above the 10-day moving average (golden cross), with volume increasing by 2 times (e.g., if ETH rises from $1,800 to $1,900, the signal appears, invest 15,000 USDT);
Buy 2 (30% position): After breaking the 20-day line (lifeline), pull back and stabilize (e.g., if ETH pulls back to the 20-day line at $1,950 without breaking, add 15,000 USDT, total position 60%);
Buy 3 (20% position): Breakthrough previous high and MACD histogram expands (e.g., ETH breaks above previous high of $2,500, add 10,000 USDT, total position 80%);
Buy 4 (20% position): The 5-day moving average crosses above the 10-day moving average again (acceleration signal), operate with full position (e.g., if ETH shows a signal when it rises to $3,000, add 10,000 USDT).
Technical anchor point: Each step of increasing position must meet 'closing price stabilizes at the signal level,' and avoid adding in case of false breakouts (e.g., a sudden spike followed by a pullback).
Data: In 2021, ETH rose from $1,800 to $4,800, using right-side strategy to increase positions, resulting in a final yield of 210%, earning 60% more than a one-time full position—because it avoided 3 false breakout pullbacks.
3. Ultimate formula: Progressive position management with leverage.
Core logic: Use a 5% small position to experiment, roll over profits to increase position, and control losses at 0.5% of total capital, suitable for contract players.
Steps to operate:
Initial trial position: Use 5% of capital (2,500 USDT) to open 3x leverage, set stop-loss at 0.5% of total capital (250 USDT)—equivalent to using 250 USDT to bet on a potential 1,000 USDT + profit;
Profit increase: After the first order is profitable, move the stop-loss to the break-even price, then open a second 5% position (e.g., after BTC's long position is profitable, use another 2,500 USDT to open an ETH long position);
Position limit: A maximum of 12 positions of 5% each (total position 60%), and it must be satisfied that 'new positions can only be opened when 80% of the positions are profitable';
Stop-loss discipline: Any single position loss reaching 0.5% of total capital must be cut immediately, and no new positions are opened that day.
Effect: In 2023, I used this method for contracts, with 11 stop-losses in a single month (total loss of 2,750 USDT), but 3 profitable trades earned 52,000 USDT—losses are 'small step slow losses', while profits are 'big step fast runs', resulting in a stair-step increase in capital curve.
4. Style choice: Switch according to market conditions, refuse to rely on one trick.
Never repeatedly jump between 'full left-side position' and 'empty right-side position.' In 2022, I witnessed the worst case: full position bottom fishing in a bear market, but when a bull market arrived, fear led to only light positions, ultimately missing a 10x market.
The essence of position management is 'using mathematics to counter human nature': left-side relies on 'batching' to reduce bottom fishing risk, right-side relies on 'signals' to amplify trend gains, and progressive relies on 'small trial and error' to lock in leverage profits. Remember: earning 3 times on 50,000 USDT is not based on a single full-position bet, but on compounding through 10 position controls—when you can maintain your position during a crash and hold your chips during a surge, you have already outperformed 90% of retail investors.
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