It's three in the morning, and you're glued to the market, every tick of the candlestick chart twitching your nerves. Does this scene sound familiar? Bro, you and I are both "small investors" seeking opportunities in this jungle, and I deeply feel the pain.
Lost in the bombardment of information: "Big guys calling for orders", "big whales making unusual moves", "top secret good news"... news that is difficult to distinguish between true and false comes like a flood, you are exhausted and eventually become the "fuel" under the scythe of others.
The cycle of emotions: FOMO (fear of missing out) forces you to buy at high prices, while FUD (panic) forces you to sell before dawn. Greed and fear, like invisible shackles, shackle every rational decision you make.
Falling from the dream of getting rich quickly: The "10,000-fold myth" and "1,000-fold dog" in the group stimulate your nerves. You know the risks are huge, but you still rush into the fire. The result is often that the principal is reduced to zero in the splendor.
Self-punishment for completely misplaced rhythms: When I should have stopped my losses, I hoped for a lucky break and said, "Wait a little longer." When I should have held on, I panicked and cried, "Run!" Slapping myself left my account bloody.
The confusion after blind pursuit: Worshiping various "great gods" and "teachers", relying on their "imperial edicts", but neglecting to establish one's own trading cognition and system, and the account becomes a testing ground for others.
Here comes the heartfelt words:
Survive! Survive! Survive! It's ten thousand times more important than daydreaming of sudden wealth. Don't go all-in, and stay away from highly leveraged contracts (unless you're a true expert). Your principal is your lifeblood; only by keeping it can you capitalize on a comeback. I've seen too many people lose everything overnight, and that despair is unforgettable.
Build your knowledge barrier. In an age of information overload, your brain is more reliable than your ears. Spend time understanding the language of candlestick charts, understanding the essence of the project, and mastering on-chain data. Only with true understanding can you penetrate the noise. No matter how much "inside information" you're given, you won't make money if you don't understand it.
Planning is the shield, execution is the sword. Impulsiveness is the natural enemy of trading. For every trade, clearly define your entry point, stop-loss point, take-profit point, and position size. Write them down! Then, execute like a machine, combating human weakness. Countless of my losses stem from violating my plan.
Be wary of "gods" and "dogs." 99% of "wealth codes" lead to zero. Focus your energy on researching BTC/ETH and projects with strong mainstream consensus. As for "leading traders"? Their opinions are worth considering, but blindly following will lead to failure. Independent thinking and risk management are your only defense. After suffering heavy losses from following the crowd, I finally understood this truth.
Respect the market and learn to be humble. The market is always right. Don't try to defeat it; follow the trend. Admit your mistakes and make timely adjustments. Losses are your best teachers, provided you don't let them crush you. I've also paid a heavy price for stubbornly holding on to mistakes.
Real advice:
Trial and error in small steps: New coin, new strategy? Try to verify it with a small position (<20%) first, then consider increasing your investment.
Ironclad Stop-Loss: Never leave anything to chance! Set clear, dynamic stop-loss levels and enforce them. Save your life first!
Focus on the main warehouse and diversify moderately: The main warehouse should hold BTC/ETH steadily (60%-70% is recommended), and the rest should be allocated to 1-2 projects that have been deeply studied.
Even when you're short, you still win: Don't understand or the market is in a frenzy? Hold on, wait and see. You never lose money when you're short!
The cryptocurrency world is full of opportunities, but also filled with traps. Turning things around isn't gambling, but the result of improved cognition, rational decision-making, and the compounding effect of time. Focus less on quick success and more on building survival skills; be less driven by emotions and more on following your plan.
So how do you succeed in cryptocurrency trading? Once you enter the financial market, it's hard to turn back. If you're currently losing money and still feeling lost, and you plan to make cryptocurrency trading your primary career, you absolutely must know the "Simplest MACD Strategy." Understanding it thoroughly will definitely help you avoid many detours. These are all personal experiences and insights, so I recommend saving them and pondering them over and over again!
Bitcoin K-line MACD reference
1.The algorithm of MACD is: subtract the slow exponential moving average (EMA26) from the fast exponential moving average (EMA12) to get the fast line DIF, and then use 2×(fast line DIF-DIF's 9-day weighted moving average DEA) to get the MACD column.
2. Basic usage of MACD: MACD indicator is formed by combining two lines and one bar. The fast line is DIF, the slow line is DEA, and the bar chart is MACD.
(1) MACD Golden Cross: DIFF breaks through DEA from bottom to top, which is a buy signal.
(2) MACD Death Cross: DIFF breaks through DEA from top to bottom, which is a sell signal.
(3) MACD turns from green to red: The MACD value changes from negative to positive, and the market turns from short to long.
(4) MACD turns from red to green: The MACD value changes from positive to negative, and the market turns from bullish to bearish.
(5) When both DIF and DEA are positive, that is, both are above the zero axis, the general trend is a bull market. When DIF breaks through DEA upward, it can be used as a buy signal.
(6) When both DIF and DEA are negative, that is, below the zero axis, the general trend is a bear market. DIF falling below DEA can be used as a sell signal.
(7) When the DEA line diverges from the K line trend, it is a reversal signal.
MACD is a very practical technical indicator used by most stock traders and cryptocurrency traders, but few can truly master it. However, if used effectively, MACD can successfully identify rising or falling prices at relatively low levels. This provides valuable insights into actual trading.
The MACD indicator, known as the Moving Average Convergence Divergence (MACD), is a broad trend indicator. It consists of five components: the long-term MACD, the short-term DIF, the red energy bar (short), the green energy bar (bullish), and the O-axis (bull-bear dividing line). It uses the crossover of the short-term DIF and the long-term MACD as a signal. While the MACD indicator generates slow crossover signals, it is effective when used to develop trading strategies.
DIF line: the difference between the short-term and long-term exponential moving averages of closing prices
DEA line: M-day exponential moving average of DIFF line
MACD trading practical skills:
1. MACD top divergence escape top
Before trading in cryptocurrencies, first determine the trend of the Bitcoin MACD indicator. If the MACD and Bitcoin are moving in the same direction, that is, the currency is rising and the MACD is also rising, Bitcoin is moving in a healthy direction and you can rest assured to hold the currency and wait for it to rise. If the market is rising and the MACD is falling, and the two movements are diverging, then you must sell the currency after three divergences.
2. MACD bottom divergence bottom fishing
If Bitcoin and other cryptocurrencies have been declining for a while, if you're looking to buy the dip, you must first analyze the MACD (Macro Convergence Divergence) chart and the stock price to see if there's a bottoming divergence. This means that while Bitcoin and other cryptocurrencies are falling, the MACD is rising. Bullish stocks typically experience a long period of divergence, and the initial divergence may not be the bottom yet; some may continue to fall. This time, the decline may be more severe and deeper, but the MACD doesn't fall. This indicates the true bottom has been reached, and it's time to buy the dip.
3. MACD, 0-axis buying method
If the MACD white line and yellow line form a golden cross above the 0 axis (preferably close to the 0 axis), or below the 0 axis and close to the 0 axis, the market is more likely to strengthen and you can make money by buying.
4. After the golden cross below the zero axis, the golden cross will appear again
After DIF crosses DEA below zero, it either does not cross above zero or crosses slightly before returning below zero, then crosses DEA downward, and then crosses DEA again a few days later. This pattern is a bottoming pattern formed when the selling pressure is exhausted after the price of the currency has bottomed out. It should be understood as a bottoming rebound signal, and you can choose to enter the market at an appropriate time.
5. There is no dead cross callback reversal under the golden cross zero axis
A golden cross below zero without a dead cross pullback reversal occurs when the DIF crosses the DEA line below zero, then fails to cross above zero and pulls back toward the DEA line. The MACD red column shortens, but if there is no dead cross, the DEA line reverses upward again, accompanied by a lengthening of the MACD red column. This pattern often forms a bottom pattern, which appears when the selling pressure has exhausted after the price has fallen to the bottom. It should be understood as an area where the main force is building a position, and an opportunity can be selected to intervene.
6. Sell when MACD diverges
If the market is strong, the MACD white line is far away from the yellow line, and both lines are far away from the 0 axis, be careful of a pullback.
7. Sell when MACD double cross appears
If your holdings are trapped, the MACD white and yellow lines form a dead cross with the 0 axis, or form a dead cross below the 0 axis, or the white and yellow lines do not form a golden cross below the 0 axis, and the trend slightly flattens and then falls, indicating that the coin is completely weak and has another wave of decline. You must follow the "three nevers" principle to sell out the coin: never linger, never have delusions, and never feel heartbroken.
DIFF line buying pattern aerial cable
The Aerial Rope pattern occurs when the DIFF line crosses the DEA line below the zero axis and then moves above the zero axis. As the stock price pulls back, the DIFF line also begins to pull back. When the DIFF line pulls back to the DEA line, the two lines merge into one. When they separate again to form a bullish divergence, the Aerial Rope pattern is formed. This pattern is shown in Figure 1.
Figure 1 Aerial cable configuration
The Aerial Rope pattern is a strong bullish signal. When a golden cross forms below the zero axis, and both the DIFF and DEA lines successfully break through the zero axis, it indicates an upward trend. At this point, a pullback by the DIFF line aligns with the DEA line, signaling a positive market buildup. A subsequent upward movement by the DIFF line signals renewed upward momentum and a significant price increase. Investors can actively buy when the DIFF line diverges upward.
As shown in Figure 2, on October 14, 2009, the DIFF line of Yaxing Chemical crossed the DEA line below the zero axis. After that, the DIFF line and the DEA line successfully broke through the zero axis. This indicates that the market upward trend has initially formed.
Figure 2 Yaxing Chemical Daily K-line
On November 3, 2009, the coin's DIFF line surged and then retreated, converging with the DEA line above the zero axis, forming a bullish divergence pattern. This indicates that upward momentum has resumed and the coin's price is about to rise. Investors should seize this buying opportunity.
In actual combat, investors should pay attention to the following two aspects:
① Although this pattern rarely appears in actual combat, once it appears, the price of the currency tends to rise rapidly, and may even rise sharply for a period of time.
To more accurately identify buying opportunities, investors can combine other technical analysis tools for comprehensive judgment. In the case of Yaxing Chemical, on November 2nd, the price candlestick chart formed a bullish engulfing pattern above the 60-day moving average, indicating that a tethered pattern was about to form. Aggressive investors could have bought on November 2nd.
DIFF:EMA(CLOSE,12)-EMA(CLOSE,26);
DEA:EMA(DIFF,9);
MACD:2*(DIFF-DEA), COLORSTICK;
Low golden cross: =CROSS(DIFF,DEA) AND DIFF
STICKLINE(low golden cross,0,0.3,8,0),COLORYELLOW;
JCCOUNT:=COUNT(CROSS(DIFF,DEA),BARSLAST(DEA>=0));
Second Golden Cross: =CROSS(DIFF,DEA) AND DEA
STICKLINE(secondary golden cross,0,0.2,8,0),COLORff80ff;
DRAWICON(Second Golden Cross,dea*0.9,1);
A1:=BARSLAST(REF(CROSS(DIFF,DEA),1));
底背离:=REF(CLOSE,A1+1)>CLOSE AND DIFF>REF(DIFF,A1+1) ANDCROSS(DIFF,DEA);
STICKLINE(bottom divergence,0,0.1,8,0),COLORRED;
DRAWLINE(A1=0,DEA,Bottom Divergence,DEA,0),COLORRED,linethick2;
A2:=BARSLAST(REF(CROSS(DEA,DIFF),1));
Top divergence: =REF(CLOSE,A2+1)DIFF AND CROSS(DEA,DIFF);
DRAWLINE(A2=0,DEA,Top Divergence,DEA,0),COLORGREEN,linethick2;
Investing should be as natural as breathing
The cryptocurrency market is unpredictable; future trends can only be explored based on past data. To effectively analyze the cryptocurrency market, one must study the psychology of other investors. As everyone knows, technical analysis in the cryptocurrency market relies heavily on studying historical data. If one blindly follows a pattern, one is bound to fail. In the cryptocurrency market, public sentiment has become the single greatest influence on coin prices, surpassing all other factors. Therefore, studying public psychology is essential.
Warren Buffett, the stock market magnate, has always emphasized that investors should invest in products they are familiar with. In essence, he's emphasizing the importance of not following trends. While everyone has their own unique personalities, when people gather together, their individual consciousness gradually fades, and their imaginations are influenced by others, becoming more realistic and illogical. In the stock and cryptocurrency markets, intelligence, hard work, experience, and luck are all essential. Luck often favors the hardest-working, not the smartest.
Only by relaxing our minds, keeping a cool head, and treating investment as natural as breathing can we become winners in the cryptocurrency world and achieve ideal results.
I used to wander around in the dark alone, but now the light is in my hand.
The light is on, do you want to follow?
From today on, be the general of your own account. Survive, accumulate chips, and wait for the wind to rise. Brother, when we meet at the top of the mountain, may you and I no longer be leeks to be harvested, but true survivors.
Respect the market, keep evolving, protect your capital, and survive!
