In the cryptocurrency world for ten years, I have seen too many myths of "getting rich overnight" and witnessed even more scenarios of "going to zero". Some have made a fortune by chasing hot trends, only to lose everything in a single gamble; others have jumped in based on "insider information" and ended up with nothing left of their principal.

In the past ten years, I have interacted with over ten thousand investors, but only less than 10 have truly crossed bull and bear markets to achieve financial freedom. Behind the 1% success rate lies a harsh truth: the cryptocurrency market has never been a "game of luck", but rather a "battle of understanding".

Those who survive and make money understand one principle: there are rules hidden in the candlestick chart, signals within market fluctuations, and more important than technique is to first learn to "not be eliminated by the market". Today, I will share my survival rules and practical skills without reservation—after all, in the cryptocurrency world, staying alive is key to waiting for the right opportunity.

First, we need to understand that beginners will often check a lot of information to understand the cryptocurrency contract model before investing in digital currency contracts, even opening an account to try it out. After a few operations, they may feel that they are not suited for this market because they lack many details and techniques.

Secondly, cryptocurrency contract trading techniques must also include stop-loss and take-profit controls. Setting stop-loss and take-profit is not only necessary for beginners but also for experienced cryptocurrency investors, as it is essential in cryptocurrency contract operations. Since investing involves both gains and losses, individuals have different tolerances for losses, and stop-loss settings should be based on the investor's own situation.

In the cryptocurrency market, its high profitability and stimulation are loved and pursued by many investors. But for newcomers, how much money is needed to trade cryptocurrency contracts?

(1) In fact, many investors initially invest only a small amount, not because their funds are limited, but for safety reasons. They gradually increase their investment as they assess the situation until they reach a suitable capital ratio.

(2) A widely recognized saying in the financial management community is that contract investment assets should not exceed 20% of total investment assets. That is to say, if a person is prepared to invest 1 million, then the money allocated for contract operations should not exceed 200,000.

Can contracts be profitable? Three important experiences in contract operations!

Experience 1: Reasonably control your position. Because only by reasonably controlling your position can you have a stable opportunity for profit; otherwise, your account will only lead to failure. Generally, invest 20% of your funds into the market; if your account has only $50,000 and the margin is $1,500 per contract, then your standard position size per trade should be 6-7 contracts, whether long or short.

In favorable market conditions, if the entry order is profitable, you can gradually increase your position without exceeding 40%. Conversely, if the entry order is at a loss, absolutely do not increase your position against the trend unless you have abundant funds to support it.

Experience 2: Set stop-loss before entering the market. Generally, 50-100 points is appropriate, or below the support level and above the resistance level. Not setting a stop-loss means that every trade could lead to account destruction.

Experience 3: Understand the nature of the market and avoid guessing the top.

Many investors are generally accustomed to looking at daily charts, weekly charts, and making short-term trades, treating BTC's long-term volatility as short-term operations, while treating BTC's short-term volatility as long-term operations, completely ignoring the differences between short-term and long-term trading. This is incorrect; operating this way for a long time will lead to increasingly larger losses later on.

Through the above analysis, we understand what skills beginners need to master when operating in cryptocurrency contracts; these skills are just part of it. Choosing a reputable platform is also important, among other things.

How should a cryptocurrency novice view candlestick charts to enter the market?

In the cryptocurrency world, using candlestick charts to judge entry timing is an important technical analysis method. Here are some methods to judge entry timing based on candlestick charts:

1. Identify trends

• Uptrend: If multiple consecutive bullish candles (green) appear on the candlestick chart, and each bullish candle's closing price is higher than the previous one, it indicates that the market is in an uptrend.

• Downtrend: If multiple consecutive bearish candles (red) appear, and each bearish candle's closing price is lower than the previous one, it indicates that the market is in a downtrend.

• Trend reversal signals: Certain specific candlestick patterns like hammer, inverted hammer, morning star, engulfing patterns, etc., usually occur at trend reversals and can serve as entry signals.

2. Focus on support and resistance levels

• Support level: When the price drops to a certain range and repeatedly rebounds, that range is the support level. If the price approaches the support level and a bullish candlestick pattern (like a hammer) appears, one can consider entering a long position.

• Resistance level: When the price rises to a certain range and stops rising multiple times, that range is the resistance level. If the price approaches the resistance level and a bearish candlestick pattern (like a hanging man) appears, consider entering a short position.

3. Volume-price coordination

• Volume-price coordination in an uptrend: If the price rises while the trading volume also increases, it indicates strong buying power in the market, and one can consider entering a long position.

• Volume-price coordination in a downtrend: If the price declines while trading volume increases, it indicates strong selling power in the market, and one can consider entering a short position.

4. Special candlestick patterns

• Hammer candlestick: Appears at the bottom of a downtrend, with a long lower shadow, at least twice the body, indicating that the market may reverse upward, signaling a long entry.

• Inverted hammer: This pattern resembles a hammer candlestick but has its shadow on top, indicating that the market may reverse upward, suitable for entering long positions.

• Three white soldiers: Composed of three consecutive bullish candles, each with a closing price higher than the previous candle's highest price, indicating a strong market uptrend, suitable for entering long positions.

• Bullish engulfing pattern: A long bearish candle followed closely by a shorter bullish candle, with the bullish candle completely within the body of the bearish candle, indicating that the downtrend may be ending, suitable for entering long positions.

5. Combine technical indicators

• Moving average crossover: When the short-term moving average (like the 5-day MA) crosses above the long-term moving average (like the 10-day MA), forming a golden cross, it indicates that the market may enter an uptrend, providing a signal to enter long.

• MACD indicator: When the short-term MACD line crosses above the long-term MACD line, forming a golden cross, it indicates that the market bullish trend is strengthening, suitable for entering long positions.

6. Risk management

• Set stop-loss: When entering the market, it is advisable to set a stop-loss point to control risk. The stop-loss point can be set outside key support or resistance levels.

Why do I always make small profits and big losses?

In cryptocurrency investment, there is a common phenomenon: clearly deciding to do trend trading, yet often getting lost in operations, wanting long-term gains while unable to resist pursuing medium-term swings, and even unwilling to miss out on short-term small profits. The result is often disappointing returns, frequently getting trapped, and even losing and exiting, ultimately missing wealth in the trend.

This phenomenon appears to be an issue of 'opportunity cost', but in reality, it is a problem of understanding, mindset, and execution.

Step 1: Turn long positions into medium positions and cash in profits early.

Step 2: Medium positions become short positions, repeatedly chasing rises and falls.

Step 3: Trend trading is completely out of control.

How to truly grasp wealth in trend trading?

First, clarify your goals and focus on one strategy

Before investing, one needs to determine whether their target is long-term, medium-term, or short-term. Long-term investors should have a mindset of "steady as a mountain, assess the situation", while medium-term traders need to focus on swing buy and sell points, and short-term players should concentrate on short-term fluctuations. Wanting to achieve all three often leads to losing direction. To truly seize wealth opportunities, one must focus on one strategy, as the logic and rhythm of each strategy are different.

Secondly, abandon the obsession with extra profits.

If you decide to do trend trading, you must focus on long-term goals and ignore short-term fluctuations. Don't try to juggle all goals in a single trade.

Set boundaries in advance for swing and short-term opportunities; don't be greedy and try to catch everything, but rather stick to your original intention.

In investing, greed is the biggest enemy. Only by overcoming the mindset of wanting 'everything' can one truly take control of investment and maximize returns. As an old saying goes: 'You can't have both fish and bear's paw, but when the fish is big enough, it is also enough to satisfy.'

Finally, enhance your understanding of trend trading.

The core of trend trading lies in seeing the big direction clearly. Investors need to enhance their confidence in market trends through fundamental research and technical analysis. Only with sufficient understanding of the trends can they remain calm amidst fluctuations and steadily profit.

The market is never short of opportunities, but truly making money requires the patience to wait and the discipline to execute strategies. A lack of patience is often the reason many investors ultimately "give up halfway".

Having an arbitrage mindset in the cryptocurrency market is crucial to consistently making profits.

The cryptocurrency market is still a relatively new field, chaotic and mixed; for example, there are about 630 exchanges in the cryptocurrency space, with thousands of cryptocurrencies, and fierce competition. Even large exchanges must conduct various activities to attract attention, and project parties must also engage in activities to attract players.

There are benefits to this as well, providing many "money-making" opportunities, such as new coin offerings, trading competitions, mining, etc.

But why did I put "making money" in quotes? Because many people do not actually earn money through such activities and are likely to become fodder.

One of the biggest reasons for not making money is the lack of an arbitrage mindset.

What is arbitrage thinking? When arbitraging, it must be low-risk, with a hedging mindset, to guarantee that the principal does not lose as much as possible.

In plain terms, don’t let yourself be trapped.

For example, if a new coin offering comes along, and only one cryptocurrency can participate, how can you low-risk arbitrage?

Many people's first reaction is to buy this cryptocurrency to participate in activities.

So what if this cryptocurrency drops? Participating in activities might only earn you 1% of your principal, but it's quite normal for the cryptocurrency to drop by 10%, and if the profit earned is less than the drop, wouldn't that trap you?

Many people say that this cryptocurrency has good news and will go up.

Alright, let me ask again, how much position can you buy in this cryptocurrency?

You can't really buy too much, right? You can't just buy this one cryptocurrency with all your funds; you need to have your allocation.

You might say, it doesn’t matter, I just want to buy a lot, I want to go all in!

(Trading Insights):

After trading for a long time, I increasingly feel that technology is a weapon, but mindset is the armor.

I have spent sleepless nights staring at plunging candlesticks in bear markets, and almost lost my mind looking at paper profits during bull markets. I later realized that moving averages can tell you the trend, RSI can remind you of strength, but what really determines profit and loss is the restraint in the face of 'should I chase the rise', the decisiveness of 'should I stop loss', and the clarity to maintain principal when 'the market is crazy'.


The cryptocurrency market fluctuates rapidly, fast enough to experience life's ups and downs in just one day; but the logic of making money is very slow, slow enough to require the patience of honing a sword for ten years, engraining the rules into your bones and integrating your understanding into every decision.

Remember, the market is never short of opportunities; what's lacking is those who are prepared. Instead of chasing the market, it's better to calm down and sharpen your "sword"—when the storm comes, you'll find that what saves you is not luck, but the part of you that "understands the market and understands yourself".


May we all maintain our rhythm amidst volatility and earn money within the scope of our understanding during cycles.

Trading cryptocurrencies is about repeating simple tasks consistently over time, mastering a method to perfection, and just like in other industries, practice makes perfect, allowing for instinctive decisions.

This year marks my seventeenth year in cryptocurrency trading, starting with $10,000 and now supporting my family through trading! I can say that I have tried 80% of the methods and techniques in the market. If you want to make trading your second career to support your family, sometimes listening and observing more can reveal insights beyond your understanding, which may help you avoid five years of detours!

Follow me@加密大师兄888 to keep up with the trend and get rich together! Bulls and bears coexist.