Now I have a desk set up on the balcony, watching the market in the morning and spending time with my child in the afternoon. The 500,000 USDT in my account is slowly growing like a snowball. In fact, short-term trading in crypto isn’t that mysterious — it’s like playing poker; the important thing isn’t having good cards but knowing when to bet and when to fold.
If you have funds within 500,000 USDT, remember this: the essence of short-term trading is not 'quick profits', but 'exchanging controllable risks for certain profits.'
When you can see 'money secretly entering the market' in the 15-minute K line, rather than just seeing red and green numbers jumping, you are not far from stable profits.
1. The enlightenment of Bitcoin in 2011: The death trap in the 5-minute K line.
In 2011, while browsing forums in an internet café, the popup news 'Bitcoin breaks $30' struck me like lightning.
At that time, I had just retired and was confused about my life direction. The concept of 'decentralized currency' made my blood boil — I realized that I could make money just from K-line fluctuations without having to look at my boss's face.
In the first half year, I flipped through Japanese candlestick charts with a 3,000 yuan capital at the Mentougou exchange to trade spot.
Only focusing on the 5-minute line for short-term trading, entering on MACD golden cross and exiting on dead cross, believing I have mastered the holy grail. As a result, after a year, I paid over 8,000 in transaction fees, and my account was left with only 1,200.
Looking back now, I made three fatal technical mistakes at that time:
Ignore cyclical resonance: When the 5-minute line shows a golden cross, the daily K line is still in a downward channel, a typical small cycle false signal.
Did not account for slippage costs: Altcoins have deep depth differences, and market orders often execute 3-5 points worse than expected.
Stop loss without quantification: Setting stop loss levels based on feelings, and after falling below, always fantasizing about a 'false breakout', ultimately ending up deeply trapped.
In 2013, I got involved with OKCoin's leveraged trading, going all in on Litecoin with 2x long positions, catching the bull market in November, and doubling my capital in three days.
At that time, I thought the crypto market was an ATM, until the central bank issued a statement in December, and LTC plummeted from 80 yuan to 20 yuan. Just one second before the forced liquidation, I was still adding margin, ultimately liquidating down to 37 yuan.
Only then did I understand: leverage is a magnifying glass; it can amplify profits but can also magnify the foolishness of 'not believing in the evil'.
2. The darkest moment of 2015: The technical awakening behind a 1 million debt.
The real destruction began with the launch of ETH in 2015.
Back then, I was obsessed with the 'swing + contract' dual strategy, believing that my improved 'Bollinger Band breakout strategy' could guarantee profits: long at the lower band and short at the upper band, using 3x leverage.
After three consecutive months of profit, I started to go crazy with leverage — I borrowed 500,000 from relatives, cashed out 300,000 on my credit card, and even mortgaged my parents' old house.
On July 20, ETH surged from $12 to $15. I opened a 10x short position at 14.8, firmly believing that 'overbought must correct.' But at 4 AM, Vitalik suddenly announced the completion of the DAO fork, and ETH shot up to $18, with the margin rate instantly dropping below 10%.
At that time, the technicals clearly showed that the RSI had reached the overbought zone at 85. Why did I get liquidated? Only in hindsight did I discover the fatal flaw:
Did not combine on-chain data: Glassnode showed that whales were continuously depositing 100,000 ETH in the $14-$15 range, and I clearly ignored this accumulation signal.
Mismatch between leverage and volatility: At that time, ETH's 24h volatility reached 18%, 10x leverage means that just a 10% fluctuation could lead to liquidation, which was a high probability event in the market at that time.
Stop loss execution failure: Pre-set a $16 stop loss, but while watching the market late at night, I fell asleep, got liquidated in my dreams, and the manual liquidation was never triggered.
When the liquidation call came in and my phone was dead, my account balance was only 0.003 BTC. That night, I sat by the river all night, my phone filled with debt collection messages. My wife silently transferred her dowry money, saying only, 'Don't despair, if the strategy is wrong, just adjust it.'
3. The technical breakthrough in 2017: 365 days of iteration from simulated trading to real trading.
After half a year of silence, I used 20,000 yuan given by my wife to open a simulated account, doing three things every day:
Draw 100 candlestick charts: Mark ETH support levels at different cycles (such as the 20-week moving average, previous high neckline), discovering that the 60-day moving average is a strong resistance in a bear market.
Backtested 2,000 trades: It was found that the long signals of 'RSI<30 + volume bullish candle' had a win rate 42% higher than a simple golden cross.
On-chain data modeling: Quantifying exchange net flow, large transfers (>1000 BTC), etc. When 'daily net inflow exceeds 500 million USDT', the long position win rate increases to 71%.
In the 2018 bear market, I used this 'technical + on-chain data' combination for practical trading:
Spot side: When BTC broke below $6,000, combining Glassnode's SOPR indicator (<0.85), I built positions in batches, adding 10% to my position for every 10% drop, strictly controlling the position to within 50%.
Contract side: Only trade trend positions on the 4-hour level, with margin usage never exceeding 30%, and stop loss set at the 1/2 position of the most recent large bullish candle.
The crucial breakthrough was during the crash on March 12, 2020: At 2 AM, I discovered that the funding rate for BTC perpetual contracts suddenly dropped to -0.5% (annualized -182%). Combined with the 1-hour chart showing a 'morning star' pattern, I decisively opened a 2x long position and made back 600,000 in 5 days, clearing all my debts.
4. The current trading system: Written for you who are still in loss.
Now I have three pieces of paper posted in front of my trading desk:
Three requirements for entering the market:
Daily K line stands firm on the EMA20 moving average.
On-chain transaction numbers increased for three consecutive days.
Contract funding rate is within ±0.01% (long-short balance).
Position formula:
Number of contracts opened = (Account net value × 2%) ÷ (Stop loss points × Contract multiplier)
Example: For a 100,000 USDT account, with ETH stop loss at 50 points, 1 contract = 10 USDT, number of contracts opened = (100,000 × 2%) ÷ (50 × 10) = 4 contracts.
Stop loss iron law:
Maximum floating loss in spot trading should not exceed 5% of total funds, and single coin positions should not exceed 30%.
Contract stop-loss must be absolutely executed, even if it later proves to be a false breakout.
Stop trading on the day after two consecutive stop losses, and review the indicator parameters.
Last year, I bought a house with a terrace in Hainan, where I could see the sea during the transaction.
My wife often laughs at me: 'Back then, I held my bladder all day to watch the market, now I’ve learned to take a walk after the market closes every day.' In fact, in the end, trading is about the basics of technology, while mindset is the amplifier — when you can prove with data that 'this trade has a 70% probability of making money, and even if wrong, only a 2% loss', you naturally won’t panic.
If you're still struggling on the edge of liquidation, I'll share with you what I have posted on my monitor: 'There is no holy grail in the crypto world, but there is math.'
Quantify every trade with data, and the market will give you answers.
If you're also a tech enthusiast feeling helpless and confused in trading, wanting to learn more about cryptocurrency knowledge and firsthand cutting-edge information, click on the avatar to follow the old博, so you won't get lost!
The old博 only does real trading; the team still has positions available, so hurry up.
