Here are some practical tips for the cryptocurrency market:
Cost Calculation and Position Management
It is essential to accurately calculate cost dilution. For instance, after investing funds and adding more capital, one cannot simply average the costs. Understanding how to calculate costs helps in managing positions reasonably and avoiding wrong decisions during price fluctuations.
Utilize Compound Interest
Compound interest can have a significant effect on returns in the cryptocurrency market. If one can maintain a certain daily return rate, after several trading days, assets can increase substantially. However, it is important to note that in actual operations, maintaining stable returns to sustain compound interest is challenging and requires mature trading strategies and a good mindset.
Grasp Take Profit and Stop Loss with Probability
Clearly define the probability of success in your investments and set reasonable take profit and stop loss points. Strictly follow the trading plan and do not be swayed by emotions; this way, after multiple trades, achieving a good return rate becomes possible.
Control Greed
Greed is a major enemy in cryptocurrency trading. During the trading process, even with a good return rate, if one cannot control the desire for more profits, it can easily lead to trading failures.
Contract Trading Position Management
In contract trading, position management is crucial. Compared to many who use a larger principal (20%-30%) as the base position, using 2%-5% of the principal with 20x leverage can better control risks and reduce emotional fluctuations affecting trades.