Mainstream coins are stable in the range, altcoins should guard against zeroing: 6 practical mantras in the crypto world to avoid 80% of loss traps

Why can't most people make money? Ultimately, it's because their understanding hasn't kept up. They keep thinking about making quick money in short trades, yet they haven't grasped the most fundamental 'rules of survival'.

Today, I am sharing with you the 6 practical mantras that I learned through real money, and if you understand them, you can at least avoid 80% of the traps.

First mantra: Wait for a breakout during high-level consolidation, don’t recklessly charge into low-level consolidation.

When a coin is trading sideways at a high level, it’s like climbing a mountain halfway; either it gathers strength to reach a new high or it lacks stamina and falls down. Sideways trading at a low level is even riskier, like lingering on the edge of a cliff—one misstep could lead to new lows.

Last year, a friend of mine followed the trend and bought a high-level sideways altcoin, and without waiting for a breakout signal, he went all in, resulting in a direct plunge after half a month of sideways trading, losing 40% before cutting his losses. Remember: before the direction is clear, it’s better to miss out than to buy recklessly; wait for the signal of breakout or breakdown before taking action—it’s ten times more reliable than random guessing. Even mainstream coins have volatility logic; the sideways trading of altcoins is more of a 'disguise before the main force offloads', don’t be the one left holding the bag.

Second mantra: Don't reach out during sideways phase, price fluctuations are unpredictable and easy to get trapped

When trading sideways, the coin price is like haggling in a market, rising a bit and then falling again, with no certainty. Entering the market during this time is like betting blindly with your eyes closed—80% of the time you will get trapped.

I fell into this trap when I first entered the market: watching an altcoin trade sideways 'very steadily', I jumped in wanting to make a profit, but after half a month of sideways movement, I couldn't stand it and cut my losses to switch coins, and right after I sold, it surged 20%. Later, I learned: sideways trading is the main force 'testing patience', only moving when retail investors can't hold on anymore. With 24-hour trading in the crypto world, it's even more exhausting; why should we be the 'chopped leeks'?

Third mantra: Buy on bearish candles and sell on bullish candles; beginners must not learn recklessly.

Veteran crypto traders often say 'buy on the dip, not on the rise', meaning you can look for opportunities when the price closes with a bearish candle (downtrend), but be cautious of risks when it closes with a bullish candle (uptrend). However, this mantra has a prerequisite: you must understand 'true bearish vs. false bearish' and 'true bullish vs. false bullish'.

For example, if a mainstream coin closes with a bearish candle in an upward trend, it may be a short-term correction, and buying then is likely profitable; but if it closes with a bullish candle in a downtrend, it may be a 'bull trap', and chasing it will definitely get you trapped. Beginners without market sense should avoid reckless actions—first, practice 'trend judgment'—check if the daily line stands firmly above the moving average, and whether the volume corresponds. Otherwise, it's easy to misinterpret the direction, mistaking a correction for a decline and a bull trap for a reversal.

Fourth mantra: Slow declines and rebounds can be exhausting, while sharp declines and rebounds come swiftly.

The 'posture' of a price drop is very important: if it falls slowly, like an old person taking a walk, the rebound will also be sluggish; but if it suddenly accelerates and crashes (like a flash crash), it’s like being pushed, and the rebound is often quick and fierce, allowing for a fast recovery of some losses.

On the day of Bitcoin's 31.2% plunge last year, I bottom-fished a mainstream coin that was plummeting, and it rebounded 8% the next day, allowing me to take timely profits; while another altcoin that was slowly declining took a month to rebound. By the time people lost patience and sold, it surged right after, making them frustrated. Remember: a sharp drop signals 'repair opportunities after panic' (especially for mainstream coins), while a slow decline means 'wait for trend reversal before entering' (a slow decline in altcoins is basically a precursor to going to zero).

Fifth mantra: Pyramid-style building positions, buying more as it drops has prerequisites.

The core of value investing in the crypto world is 'pyramid building': if you believe in a coin, first try a small position; the more it drops, the more it proves to be 'cheap', then increase your position to lower your cost. But there’s a strict prerequisite: you must truly understand the value of this coin and not mistake 'air coins' for treasures.

My Ethereum was operated this way; I added to my position when it dropped 30% during last year's bear market, and after another 15% drop, I added more. Now, not only have I broken even, but I've gained 60%. However, if you don't understand the value and buy recklessly—like 'buying more of an altcoin with no real use case as it drops', you'll only end up deeper in the trap—this mantra's key is not 'buy more as it drops', but 'buy more of mainstream coins with ecosystems as they drop'.

Sixth mantra: After a big rise or fall, there must be sideways trading; keep a close eye on the direction of the change.

After a significant rise or fall in price, there will definitely be a sideways trading period, just like needing to catch your breath after running. During this time, two types of operations should be avoided: panicking and selling all during high-level sideways trading (you might sell right before the surge), or greedily buying all during low-level sideways trading (you might buy right at the start of a decline).

The correct approach is to focus on 'signal changes': if a high-level sideways trading breaks below the support level (like the MA30 moving average), decisively liquidate without hesitation; if a low-level sideways trading breaks above the resistance level (like the previous high), timely follow up and don't miss out. Last year's wave of AI concept coins saw many people cutting losses during low-level sideways trading out of 'fear of decline', only to see it double after breaking out, leaving them kicking themselves—remember, a 'breakout' in altcoins may be the last trap, while a breakout in mainstream coins is more reliable.

Lastly, I want to say: trading cryptocurrencies earns from 'cognitive differences'; first learn to survive, then learn to earn.

The most ruthless lesson the crypto world taught me over nine years: It's not that the market is bad, it's that you don't understand 'the temperament of the crypto world' (24-hour volatility, high leverage temptation, the risk of altcoins going to zero); it's not that you can't make money, it's that you haven't adhered to 'the rules of not losing money'.

These 6 mantras seem simple, but very few can actually implement them. Some always think about 'getting rich quick' by leveraging and chasing altcoins, ending up unable to protect their principal; while others diligently practice 'not losing the basics', making waves with mainstream coins, and gradually earning big money.

Remember: the crypto world is never a 'casino', but rather a 'battlefield of understanding'. First, learn to avoid traps (don’t touch air coins, don’t use high leverage, don’t stop-loss without taking profit), then think about how to make money; that’s the way to stay in the game for the long haul. If you can fully grasp these 6 phrases, you can at least surpass 80% of retail investors—the rest is up to time and trends.

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