After seven years of trading cryptocurrencies, I have come to understand the temperament of this industry. The first three years were spent in futile struggles, losing over 100 units, but later, through the knowledge gained and strict discipline, I managed to earn back several hundred units – every single one stained with lessons learned through blood and tears.
The secrets of this market keep repeating: 90% of people chase news, buying high and selling low, becoming fodder; 9% try to gauge the movements of the big players, often getting played; the stable 1% have long used moving averages as scalpels to dissect market trends.
First, let’s get acquainted with moving averages. Think of them as three seasoned doctors: the 5-day line is the head of the emergency department, quick and impatient; the 30-day line is a skilled internist, steady and measured; the 60-day line is a specialist, looking far ahead. If the head of the department rises above the two senior predecessors (the 5-day line crosses above the 30/60-day lines), it signals a market reversal; if it rolls down from the specialist chair (the 5-day line crosses below the 30/60-day lines), don’t hesitate, quickly reduce your positions.
Next, build a trading system to prevent impulsive decisions. Stick a note on your trading interface, bolding the words: when moving averages clash, mere mortals should not interfere. Jumping in when the 5-day and 30-day lines are intertwined is like rolling dice to guess odds; a hunter waits until all three lines are aligned in one direction before pulling the trigger.
The extreme volatility in the crypto market is the norm, and the daily moving average strategy works best when kept simple. Like martial arts masters sparring, there’s no need for fifty different starting moves; when the 5-day line breaks through, draw your sword, and when the 60-day line turns, sheathe it, clean and swift.
The key is to weld discipline onto your trading platform. Too many people write their trading plans on napkins, and with a midnight spike, they tear it up to wipe their cold sweat. The daily moving average strategy is ruthless because it forces you to become a machine that executes signals without emotion.
There’s a trader who made consistent profits with this strategy for three years; at his wedding last year, he received an alert that the 5-day line had broken down, ran to the restroom to close his positions before coming out to change rings. His bride pulled on his ear, scolding him, and upon seeing his account balance, silently replaced his monitor with a high-end one.
This is something to engrave in your heart: you may doubt your own judgment, but never doubt the tightly twisted moving averages. If you want to make money, don’t be a reckless lone warrior; it's much better to ponder practical methods than anything else.
