In the 8 years of ups and downs in the crypto space, going from a loss of over 1 million to easily gaining hundreds of coins, the core is not luck, but a set of 'rolling position strategies' validated by practical experience. This logic of adding positions based on floating profits and anchored in trends can allow an initial capital of 10,000 yuan to multiply to 4 million in a one-sided market — but it is by no means just 'adding positions to bet on the trend', rather it is a systematic project that includes trend judgment, position control, and risk cutting.
One, The Essence of Rolling Positions: Letting Profits Pay for Risks
The core logic of rolling positions is to use the profits granted by the market to replace one's own funds in bearing risks, achieving 'accelerated compound interest' in the continuation of trends. Unlike the aggressiveness of futures leverage, its controllable risks manifest on three levels:
Floating profits as a shield: all position increases are built on the basis of initial position profits. For example, when Bitcoin rises from $10,000 to $11,000 (10% floating profit), at this time, use 50% of floating profits to add to the position, even if there is a subsequent pullback, the maximum loss will only be this part of the profit, without touching the principal.
Trend as the guideline: only add positions when signals confirming the trend appear, such as 'breakout of the converging triangle' and 'moving average bullish resonance'. In the 2020-2021 Bitcoin bull market, all four effective position increases were accompanied by 'large bullish candles breaking previous highs + trading volume increasing by 50%' trend resonance, with a success rate of 80%.
Position increment: the single position increase ratio should not exceed 30% of the current total position, to avoid 'losing everything in one wrong move'. For example, if the initial position is 10%, the first position increase should not exceed 3%, and the second position increase should not exceed 2%, ensuring that risk exposure gradually converges as the market progresses.
This strategy unbinds 'profit' from 'risk' — enlarging the position for greater returns when profitable, and only losing part of the floating profit when losing, essentially 'letting the trend work for you'.
Two, Practical Simulation: The Rolling Position Path of the 2020-2021 Bitcoin Bull Market
From October 2020 to March 2021, Bitcoin rose from $10,000 to $60,000 in a one-sided market, serving as a classic textbook case for rolling position strategies. Four key position increases contain the core code for capturing trends:
1. Initial Entry: The 'First Bite' of the Trend
Build positions when Bitcoin breaks through the long-term converging triangle upper edge (about $11,000), with an initial position of 10% (investing $1,000 from a capital of 10,000 yuan). At this time, two signals must be met:
The daily closing price stands firm above the upper edge of the triangle (trend confirmation);
Trading volume increased by 80% compared to the average of the previous 5 days (fund consensus).
Stop-loss is set at the lower edge of the triangle (about $9,800), with a risk exposure of 2%, meaning the maximum loss per trade is $200 — this is the key to 'testing with low cost'.
2. First Position Increase: 'Inertia Continuation' After Breakout
When the price rises to $15,000 (floating profit 36%), the signal of 'breakout of the ascending triangle + MA30 moving average support' appears, using 30% of the floating profit to add to the position (about $108), raising the position to 13%. The logic behind this position increase is:
The breakout of the ascending triangle indicates that short-term bullish momentum is not exhausted;
The MA30 moving average and price form a 'support resonance that holds during pullbacks'.
New position stop-loss is set at the breakout level ($14,000), forming a 'double insurance' with the initial position stop-loss.
3. Second Position Increase: 'Structural Confirmation' During Retracement
Price retraced to $20,000 (Fibonacci 0.5 retracement level), forming a bullish candle with a long lower shadow while stabilizing above the MA30 moving average. At this time, use 50% of accumulated floating profits to add to the position (about $450), raising the position to 18%. The core of this operation is 'left-side layout + indicator verification':
The Fibonacci 0.5 level is a typical support for strong pullbacks;
The lower shadow indicates that the bearish strength is weakening, with clear bullish support.
4. Three Position Increases: The 'Acceleration Signal' of the Main Upward Wave
Price broke through the previous high of $40,000, with a large bullish candle accompanied by a doubling of trading volume. At this time, use 40% of floating profits to add to the position (about $3,600), raising the position to 25%. This confirms the 'main upward wave has started' — breaking through the previous high means market sentiment has entered a euphoric phase, and short-term inertia will drive prices up rapidly.
Ultimately, in this round of market, an initial investment of $1,000 increased to $2,500 through four rolling positions, with total profits reaching $48,000, a capital return rate of 48 times — this is the magic of 'trend + compound interest'.
Three, Risk Control: The 'Lifeline' of Rolling Positions
The fatal misconception of rolling position strategies is equating 'adding positions' with 'leveraging to bet on the direction'. In 8 years of practical experience, the key to survival lies in two sets of risk control mechanisms:
1. Moving Stop-Loss: The 'Protective Shield' of Profit
After each position increase, the overall stop-loss level should be moved up to '2% below the previous position increase point'. For example, after the third position increase, the stop-loss should be moved from $20,000 to $39,200, ensuring that accumulated floating profits do not drop to zero due to sudden pullbacks. A more professional approach is to combine with the ATR (Average True Range) indicator:
Stop-loss level = position increase price - 2×ATR (filtering short-term noise);
When the price rises by 10%, adjust the stop-loss level to 'position increase price + 5%' (locking in some profits).
2. Market Adaptation: Only Trade 'Trends You Understand'
The profit from rolling positions depends on 'one-sided markets', while 90% of the time in the crypto space is in consolidation. Therefore, a 'market filtering mechanism' must be established:
The daily MACD is above the zero axis and the red bars are expanding (excluding weak consolidations);
Price forms a bullish arrangement with MA30 and MA60 (trend strength verification);
Volatility over the past 30 days > 2% (ensuring the trend has enough space).
In the 2022 consolidation market, traders who strictly executed this filter reduced their rolling position frequency from 8 times a month to once, with losses decreasing by 72%.
Four, Rolling Positions and Pyramid Position Increases: The Balance Between Conservative and Aggressive
Rolling positions and pyramid position increases are often confused, but the differences in risk preferences are significant:
Rolling positions: Each position increase is similar in proportion (e.g., initial 10%, adding 3%-5% each time), suitable for a clear trend in the main upward wave, strong profit potential, but also rapid expansion of risk exposure;
Pyramid position increase: The increase ratio gradually decreases (e.g., first increase by 5%, second by 3%, third by 2%), suitable for moderate trend markets, better risk control, but lower profit elasticity.
Beginners are more suited to start with the 'improved rolling position': Use a pyramid model for the first two position increases (5% → 3%), and after confirming the trend, use standard rolling positions (add 5%), balancing safety and returns.
Five, Beginner's Advancement Guide: From Survival to Profit
For traders who have just started rolling positions, 8 years of practical experience has summarized three 'Life-Saving Rules':
Lower profit-loss expectations: beginners find it hard to endure '20% win rate + 20 times profit-loss ratio', so it is recommended to set the profit-loss ratio to 2-3 times, increasing the win rate to 45%-55%. For example, stop-loss at 2%, take profit at 4%-6%, which can build confidence while surviving in a consolidation.
Accept 'missing out': In a year with 10 waves of markets, capturing 2-3 waves with the highest certainty is sufficient. In the 2021 bull market, only participating in 'breakouts of converging triangles + MA60 support', though missing 5 small trends, the 3 main upward waves captured still achieved tenfold returns.
Market context takes precedence over technical details: in a bull market background of 'institutional funds entering + regulatory easing', rolling position win rate increases by 30%; whereas in a bear market of 'tight liquidity + frequent black swans', positions should be reduced to below 5%, or even go to cash. Just like a fisherman wouldn't go out to sea during typhoon season, traders must learn to 'lie flat' during market downturns.
Conclusion: The Essence of Rolling Positions is 'Going with the Trend'
The transformation from 10,000 to 4 million has never relied on 'accurately predicting every position increase point', but on awe for the trend and adherence to discipline. The ultimate logic of rolling position strategy is to acknowledge that one cannot predict the market, yet can use 'floating profits as a shield and stop-loss as armor' to make the trend their 'ATM'.
The crucible of 8 years in the crypto world taught me: true profits are not about defeating the market, but about learning to dance with the trend. When you can use profits to bear risks and use discipline to filter out noise, rolling positions is no longer 'high-risk gambling', but a 'compound interest engine' that traverses bull and bear markets.
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