Among various derivatives, cryptocurrency contracts are arguably the most dangerous existence. Their leverage has long exceeded a reasonable range, and when high leverage meets chaotic fluctuations, the trading arena becomes a complete casino. The casino does not consider educational background; even graduate students, doctoral students, and graduates of prestigious universities can easily be pierced by the 'armor' of higher education once they are dominated by gambling instincts. Even more concerning is that the KOLs (Key Opinion Leaders) in this circle overlap with some idols from the post-85 to post-00 generation, such as Jay Chou and Li Xiaolai. They not only fail to set a good example but also attract a large number of fans to enter this 'casino'.


For those without a financial background, learning to play derivatives should be gradual: The first step is to understand trade and market, starting with the Dow Jones Index, which is standardized, highly liquid, and has rich interpretations that can help you understand non-leveraged trading. The S&P 500, S&P 100, and Russell 1000 are also good choices. The second step is to understand leveraged forward trading; crude oil is a suitable observation subject as it adds the time pricing concept that was not present in the first step, and since 2024, the industry supply-demand ratio affecting its price has decreased while financial and macro attributes have risen, making it easier for outsiders to observe and think. The third step is to understand options trading; it is recommended to look at the options of Tesla, Meta, and Nvidia rather than the options of the indices from the first step. Options in US stocks, commodities, or ETF options within ETP options are also viable. Many people have misunderstandings about options; in fact, they are excellent risk management tools, but investor education in Chinese is poorly done, and even futures are often misunderstood, let alone options.
Here are several life-saving suggestions for beginners, derived from real trading losses:

  1. Make trades after 9 PM. During the day, news is chaotic, with many false good or bad news, causing large fluctuations in the market, making it easy to be misled; after 9 PM, the news is generally stable, and the K-line is clearer with a more defined direction.

  2. Once you make money, take it off the table immediately. Don't always think about doubling your investment; for example, if you earn 1000 U, it is advisable to withdraw 300 U to your bank account immediately and continue to operate with the remaining amount.

  3. Look at indicators, not feelings. Don't make trades based on intuition; that's just gambling. Install TradingView on your phone, and before making a trade, check if the MACD has a golden cross or death cross, if the RSI is overbought or oversold, and if the Bollinger Bands are narrowing or breaking out. At least two of the three indicators should provide consistent signals before considering entering the market.

  4. You must exit the market every week. Every Friday, without fail, transfer 30% of the profits to your bank account, and continue to roll over the remaining amount. Over the long term, your account will become thicker.

  5. There are tips for reading K-lines. For short-term trading, look at the 1-hour chart; if the price has two consecutive bullish lines, consider going long; if the market is stagnant, switch to the 4-hour chart to find support lines and consider entering near the support level.

  6. Never step into these traps! Do not exceed 10 times leverage; beginners should best control it within 5 times; avoid dog coins and shit coins since they are easy to be harvested; trade a maximum of 3 times a day, as too many can lead to loss of control; absolutely do not borrow money to trade cryptocurrencies!


When assets exceed 30 million, there is a very foolish but almost guaranteed way to consume all profits in cryptocurrency trading, which can be mastered through gradual learning.

First,

Never do these three things in cryptocurrency trading:

First, never buy when prices are rising. Develop the habit of buying when prices are falling, practicing 'be greedy when others are fearful, and be fearful when others are greedy';

Second, never place all your bets;

Third, never go all-in; being all-in is very passive. The market is never short of opportunities, and the opportunity cost of being all-in is too high.

Additionally, there are six maxims for short-term cryptocurrency trading:

First, after the cryptocurrency price consolidates at a high level, there is usually a new high, and after consolidating at a low level, there is usually a new low. Wait until the direction of the trend change is clear before taking action;

Second, do not trade during consolidation; most people lose money in cryptocurrency trading because they cannot do this;

Third, when selecting K-line, buy on a bearish line in the daily chart and sell on a bullish line;

Fourth, if the decline slows down, the rebound will also be slow; if the decline accelerates, the rebound will be faster;

Fifth, build positions using the pyramid buying method, which is an unchanging principle of value investing;

After a continuous rise or fall, the cryptocurrency will inevitably enter a consolidation phase. At this time, there is no need to sell everything at a high price, nor to buy in fully at a low price, because after consolidation, there will inevitably be a change in trend. If the trend changes downwards from a high position, it is necessary to clear the position in time.

One should only engage in real trading; the team still has positions to enter quickly.

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