After ten years of trading cryptocurrencies, from entering at 22 to now at 32, I have built my funds to eight figures using this method. In fact, many people lose money because they trade based on feelings without a fixed trading plan. Today, I will break down my core logic for you; following it can help you avoid at least 80% of the pitfalls.
1. Want to improve your win rate? Remember the two words 'follow the trend'.
In a downtrend, every rebound is a trap for buyers; in an uptrend, every pullback is a golden pit.
Compared to bottom-fishing (guessing the bottom), buying at lower levels (waiting for the trend to clarify) has a much higher probability of making money. Don't go against the trend; the trend is the biggest 'market maker'.
2. Do not touch cryptocurrencies that experience short-term spikes, regardless of whether they are mainstream or altcoins.
There are very few cryptocurrencies that can experience multiple main upward waves. After a short-term spike, the difficulty of continuing to rise is immense - when stagnant at high levels, it will naturally fall. This principle is simple, but there are always those who want to bet that 'they are not the last one holding the bag'.
3. Use MACD to find entry and exit points, even beginners can get started.
Entry signal: The DIF line and DEA form a golden cross below the 0 axis and break through the 0 axis, which is a relatively stable entry point.
Exit signal: The MACD forms a death cross above the 0 axis and starts moving downward, decisively reduce positions to lock in profits.
4. Never average down when in loss! This is the biggest pitfall in trading cryptocurrencies.
How many people keep losing and keep averaging down, averaging down leads to more losses, and finally push themselves into a dead end. Remember: averaging down can only be done when in profit (adding in the direction of the trend); averaging down when in loss is equivalent to 'leveraging' a wrong decision.
5. Trading volume is the soul, beware of volume-price divergence.
After the price consolidates at a low level and breaks out with increased volume, pay close attention (funds entering signal).
High volume but no price increase (stagnation), decisively exit (funds selling signal).
6. Only trade cryptocurrencies in an uptrend, saving time and being efficient.
3-day line turning upward: short-term bullish signal.
30-day line turning upward: medium-term bullish signal.
84-day line turning upward: main upward wave signal.
120-day line turning upward: long-term bullish signal.
Only trade those that align with the trend, and your win rate will naturally be high, without wasting time watching the market.
7. Weekly reviews are a must to avoid being 'blinded by the current situation'.
Check the logic of your positions: Has the fundamental situation of the project changed? Have the benefits been realized?
Look at the weekly K-line trend: Does it match previous judgments? Has the trend reversed?
Adjust your strategy in a timely manner; don't let 'inertia thinking' trap you.
There are no shortcuts in trading cryptocurrencies. The so-called 'foolish method' actually simplifies the complex market into executable rules. After ten years of bull and bear markets, I have found that those who can consistently make money are often those who stick to their discipline and are neither greedy nor impatient.
I am Ah Yu, having experienced several rounds of bull and bear markets, I have encountered more pitfalls than I have earned. I will share more specific opportunities and strategies in the future to help you avoid detours. If you find this useful, you can follow me, don't wait until you miss the opportunity to regret.
