A few years ago, I earned around 4 million with a capital of 50,000. I graduated from college without ever having a job.

I have been playing in Kunming and Dali, not buying houses or cars. I spend 1500 a month. Why enter the circle?

If you want to change your fate, you must try your hand in the cryptocurrency market. If you can't make money in this circle, ordinary people will have no opportunities in their lifetime.

How I made money: with 50,000 capital, I did projects in college, worked as an affiliate, engaged in tasks, and saved up 50,000.

When I first entered the cryptocurrency market, I felt BTC was too expensive, so I stuck with ETH, which has leverage, and then I moved on to altcoins.

Choose coins and manage your position well.

Management. Just follow a simple approach consistently; if the market is poor, incur a small loss, and when the market comes, profit significantly.

In 2024, my capital multiplied by fifty times; had I not withdrawn funds twice to buy a house, it would have been eighty-five times.

It can be said that I have used about 80% of the technical methods in the market, and I will share with you the most practical one in real trading—Bollinger Bands.

22 Golden Trading Rules

And the following five techniques have been tried and tested! A profit of 30% in one month.

There is a saying in business, 'Don't work with those you are not familiar with,' and the same goes for cryptocurrency trading. Before entering real trading, one must grasp some basic operational knowledge and skills. For friends looking to showcase their skills in the cryptocurrency market, the following knowledge is crucial.

Technique One

Trading requires honesty and integrity. You might think, what does this have to do with trading? Generally, traders like to show off their profit trades and never disclose their losing trades. This is because they do not realize that a loss is also a form of profit. Every aspect of trading requires you to approach it with an honest heart.

Technique Two

Trading must adhere to rules. As the ancients said, 'Without rules, nothing can be established.' Naturally, trading has its own rules, and violating these rules will cost you your freedom. Trading should not be emotional or impulsive; you must understand when you can trade and when you cannot.

Technique Three

Trading requires patience. Open the trading software and first observe the market trend, check the data released for the day, and review the current trends—short-term, medium-term, and long-term. Then, start making a trading plan, including entry points, stop-loss points, and profit points.

Technique Four

Trading requires thought. Develop the habit of thinking during trading. Some good trading habits must be cultivated through thousands of trades; habits from simulated trading, if beneficial to your real trades, are inconsequential. However, if they hinder your trading, adjustments must be made.

Technique Five

Do not hope to buy at a low price or sell at a high price. Some people always want to buy at a low price and sell at a high price; this desperate desire to make money is terrifying, and the result often backfires—greed leads to loss.

22 Golden Trading Rules of Bollinger Bands

1. Bullish Arrangement. All three bands are moving upward. This continues for a longer period. The price is gradually rising between the middle band and the upper band.

2. Bearish Arrangement. All three bands are moving downward, continuing for a long time. The price gradually moves downward between the lower band and the middle band.

3. Box Arrangement. The three bands are nearly parallel, and the price oscillates between the upper and lower bands, termed a large box. The price oscillates between the lower band and the middle band, termed a small box.

4. Divergence Arrangement. The upper band of the Bollinger Bands forms an upward divergence while the lower band diverges downward, becoming wider apart. After a certain period, the upper band will point downward, and the lower band will point upward, gradually converging again. After narrowing to a certain extent, they will start to diverge again.

The divergence arrangement of Bollinger Bands is relatively complex. We need to analyze it carefully. Mastering this analytical method can help us quickly gain profits and avoid being trapped.

Bollinger Bands have descending channels (bearish arrangement) and ascending channels (bullish arrangement). These arrangements are easy to spot because the three bands are either upward or downward. But what about divergence arrangements? There are four stages of divergence.

Phase One: Contraction Phase.

This phase is characterized by the upper and lower Bollinger Bands moving closer to the middle band, with the opening narrowing. This indicates that the price consolidation is about to end, and the volatility is decreasing. The range of price activity is shrinking. The price will face a trend change, which could be upward or downward. If it is an upward change, it will signal the arrival of the main upward wave for that coin. If it is a downward change, it will signal the main downward wave for the individual stock. We view this phase as the best time to buy coins because it skips the lengthy consolidation phase and directly enters the upward initiation phase. However, the key is not to buy coins that are about to change downward. So how do we identify this?

Let me tell you, there are two key points:

First, the middle band must not point downward; it can only point upward or remain flat. Even a slight downward angle is not acceptable.

Second, the price must break upward through the middle band, with a bullish candle. A false bullish or bearish candle won't do; it must be a bullish candle.

Identify whether the middle band is pointing downward; if it's not clear in the chart, record the middle band number daily. The middle band is the 20-day moving average on the candlestick chart.

Every day, there are numbers that reflect this. Mastering these two points can help avoid buying coins that are about to change downward.

Phase Two: Rising Phase.

The hallmark of this stage is that the upper and lower bands separate into an 'eight' shape and move outward. The price rises along the upper band. The angle of the upper band represents the strength of the upward movement. The steeper the angle, the greater the upward momentum. The shallower the angle, the slower the rise. The strategy during this time is to hold the position. If you have not bought in here, you can only chase the buy when it just forms the 'eight' shape. If the 'eight' shape has already turned for several days, the risk of buying increases. As long as the price does not leave the upper band, continue to hold.

If the angle is steep, it might rise for just a few days before ending. If the angle is shallow, it might continue to rise for a long time, and there will be fluctuations in between, which means washouts. Don't let yourself get washed out and earn less.

Phase Three: Divergence Phase

At this point, the indication is that the price starts to leave the upper band, forming a horizontal movement. The upper and lower bands are moving further apart, creating a large surrounding pattern on the candlestick chart. The distance between the upper and lower bands is increasing. At this stage, the price forms a horizontal line, gradually moving from the upper band toward the middle band, which is trending upward, gradually approaching the price. The stock price experiences greater fluctuations. It may rise and fall without clear trends, with daily fluctuations. We call this consolidation, which can last from a few days to several months.

The strategy for this phase is that if the price does not return to the upper band three days after leaving it, sell immediately. Selling coins should be the primary strategy. If you get trapped at this time, use self-rescue methods to free yourself. You can also sell to stop loss. At this point, the loss won't be significant because the individual stock has not yet entered a downward channel; it is only consolidating sideways. Of course, the stop loss should be executed when the price is moving upward during fluctuations. This opportunity arises every day in this phase.

Phase Four: Contraction Phase

Returning to the first phase. Basically, the operating state of coins is always like this.

1. Lower Band Buying Method. When the price breaks below the lower band and then consolidates sideways for two or three days, if the price has left the lower band and is moving horizontally, this can be seen as a stop in the decline and stabilization. At this point, buying is clearly more favorable than risky. The risk of individual stocks has been fully released. Of course, buying at this position does not guarantee immediate profit. This is a good time for medium to long-term buying. The specific coin may still need to consolidate sideways for a while or may immediately reverse back above the middle band. At this time, the Bollinger pattern shows that all three bands are still pointing downward, characterized by the price leaving the lower band and moving sideways. Remember, it must leave the lower band and move sideways. If it remains at the lower band, it might still fall. The lower band line is below the price line. Pay attention to this.

Many friends are unwilling to buy coins here, thinking they need to wait a long time. I believe that participating in the cryptocurrency market is a real investment and should not be viewed from a speculative perspective. For investments, we can compare it with bank interest. If we invest once and achieve returns several times greater than bank interest, that would be quite good. Buying coins here can yield at least a ten percent profit. That is the minimum. Why can't we wait? Just maintain a calm mindset. If you are always looking at the mountains in the distance, worried about being caught again, it can be stressful.

2. Lower Band Buying Rule Two:

Another situation is when the Bollinger Bands behave like a box; the three bands are nearly parallel, moving forward. If the price drops to the lower band, it may lightly touch the lower band and then bounce back up. At this point, you can buy at the lower band. When the price reaches the middle band, it can be sold. This is a short-term operation. The key point is that the three bands must be flat; if they start to trend down, then it becomes the first situation, and this operation should not be executed. Pay attention to the analysis. Of course, you can also wait until the price reaches the upper band to sell, which will take longer, especially if some coins need to consolidate for a long time.

3. Contraction Method: This method has been explained multiple times. However, many friends fail to understand it. Many think something is contracting but are mistaken and end up getting trapped after buying. The contraction method slightly omits the consolidation period of an individual coin before its main upward wave arrives. If you grasp this entry point well, the returns will come quickly and can yield good profits. The key point of this rule is that the individual stock price must break through the middle band, which must slightly trend upwards or be flat, and absolutely cannot trend downwards. Even a slight downward trend is unacceptable.

The upper and lower bands converge from above or below towards the center, friends need to understand why the upper and lower bands will contract. The width of the Bollinger Bands represents the volatility of the asset price. When the upper and lower bands contract, it indicates that the price volatility is decreasing, which suggests a change in trend is imminent. Remember, when the price volatility decreases, a change in trend is coming, including for the overall market. Since it's a change in trend, it could go up or down. Therefore, the key here is the middle band: if it points downward, a contraction followed by a downward change indicates a major drop. If the middle band points upward, and the price goes up, then the change indicates an upward shift, leading to a major rise. If you misjudge this situation, you could get trapped. This is crucial for making a big profit or facing a significant loss.

I have repeatedly discussed this; perhaps I haven't explained it clearly. There are still friends who buy when the middle band is pointing downward. This must be analyzed clearly. There are two points: first, the middle band must be pointing upward. Second, the price must break upward through the middle band. It must be a bullish line, not a bearish line.

The key judgment for the contraction rule has another characteristic: after the upper and lower bands converge, they must separate to form an 'eight' shape, with the upper band moving up and the lower band moving down, which will increase the price volatility. They must separate into an 'eight' shape moving outward; if the upper band does not move upward and remains flat, it becomes a box arrangement. At this point, it is no longer a primary upward wave; the price will likely return after hitting the upper band.

If this kind of trend forms, we will sell when the price reaches the upper band. We buy near the middle band and sell at the upper band. We will not be trapped. We just might not catch the main upward wave.

1. The significance of moving averages. A moving average is the average cost line of the asset price over a certain period. For example, to calculate the 5-day moving average, sum the closing prices of the last five days and divide by five to get the 5-day cost price, which is marked on the candlestick chart. The next day, add the closing price of that day, subtract the closing price from six days ago, and divide by five to get the next day's 5-day cost price. This process continues to form the trend of the 5-day line, which can either rise, fall, or remain flat. The same logic applies to the others.

2. Bollinger Bands. The Bollinger Bands use the 20-day moving average as the middle band, with the upper and lower bands calculated using a formula. Then, three bands are drawn on the candlestick chart, known as Bollinger Bands. In the trading system.

You can change the main indicators in the system.

3. Application of Bollinger Bands. Bollinger Bands can be used to indicate buy and sell points. The parameters of Bollinger Bands can be set by oneself. Generally, the common setting is twenty. Nineteen or twenty-one can also be used.

4. Bollinger Band Buy Points

Low Position Method. This occurs during a bearish arrangement when the price drops, breaks below the lower band, and then consolidates sideways for several days before leaving the lower band. Buying at this point is termed low position buying. The condition is that the price breaks below the lower band and begins to consolidate sideways, with small upward and downward movements, generally after three days of leaving the lower band.

2. Contraction Method. In a divergence arrangement, when the upper band points down and the lower band points up, and they contract to a very small size, the middle band should be flat or pointing up. The price must break upward through the middle band, at which point this buying method is called the contraction method. The conditions are that there must be contraction, the middle band should be upward or flat, and the price must break upward through the middle band. All three conditions must align.

3. In a box arrangement, when the price touches or approaches the lower band, it is a buying point.

5. Bollinger Band Sell Points.

1. In a divergence arrangement. When the price rises along the upper band and a doji appears when the volume cannot push it higher, the price begins to leave the upper band and consolidates. At this point, sell. The conditions are: the price rises along the upper band; after a bullish candle, a long upper shadow, doji, or small bearish candle appears, and the price leaves the upper band, not staying on it.

2. In a box arrangement, when the price touches the upper band, breaks above it, or fails to reach the upper band and then goes down, these are all selling points.

3. In a bullish arrangement, as long as the three bands do not flatten, continue to hold, regardless of fluctuations. Sell when the bands flatten.

Before each trade, everyone should ask themselves three questions:

First, think about the reason behind each trade you open.

Second, do you often encounter situations where your profitable trades turn into losses?

Third, do you often hold positions until liquidation without knowing what to do? These three questions are unavoidable for all traders, and cryptocurrency friends have encountered them to varying degrees; everyone has experienced this, especially beginners who are often blind. The essence lies in their lack of a mature trading mindset and trading system.

What is a trading system? It is a self-methodology for trading, opening positions, closing positions, increasing and decreasing positions, taking profit, and stopping loss—essentially your own set of rules. Having such a system brings direct benefits, as all of your trades are traceable, significantly reducing the likelihood of mistakes and losses. Additionally, you won't need to monitor the market in real time. By strictly executing the system, you will have a clear understanding of your goals and losses, allowing you to remain steady regardless of market fluctuations.

So how do you establish your own trading system? The most important thing is to have a good mindset. The cryptocurrency market is open for trading 24 hours, with ever-changing and volatile conditions, requiring strong psychological resilience when trading. A person's trading habits, psychological endurance, strategy execution ability, and the ability to overcome greed and fear vary greatly, determining that each person's suitable trading system is different.

From my long-term observations, an excellent system must contain the following characteristics:

First, the trading frequency cannot be too high. Many people in the cryptocurrency market are eager to get rich; if they don’t open a trade in a day, they feel they will miss out on a potential huge market. In fact, trades should be based on market conditions rather than time. Opening trades blindly without market movements only leads to losses. There are many opportunities in the cryptocurrency market, but most are not accessible to you. Nobody can capture every fluctuation. 'Waiting' is key; learn to wait, seize your opportunities, and reduce the frequency of stop-loss trades to see a noticeable increase in profits.

Second, overcome greed. Greed is the biggest taboo in cryptocurrency trading, especially when dealing with contracts. The market fluctuates daily; where there is rise, there must be a fall. I have seen too many people miss out on doubling their trades because their greed prevented them from taking profit, leading to losses or even liquidation.

Third, strictly adhere to take profit and stop loss. This is the most crucial operation in contract trading and a key reason why I can achieve a maximum return of 11570.96%. Before each analysis of the market and the opening of trades, always consider the positions for taking profit and stopping loss, especially the stop loss position. Calculate whether the profit-loss ratio justifies the trade. When you feel confident, set both positions; regardless of market fluctuations, you will remain steady, strictly adhering to the stop loss to preserve your capital, and taking profit in stages to lock in gains.

Fourth, ensure proper position control when opening trades. Why is position control necessary? A simple calculation will make it clear: if you open a trade with a 20% profit and another with a 20% loss, with a 50% accuracy rate, after 40 cycles, your capital will be halved, and after accounting for fees, you'll end up with even less, eventually zeroing out your assets. Therefore, it is crucial to maintain proper position control. Fixed capital is a good choice, and withdrawing profits is a good habit, as what is withdrawn is truly yours; anything left on the exchange is just unrealized gains.

Fifth, practice and review to summarize. Once you learn to control your mindset, position, capital, and candlestick operation techniques, you are still missing the most crucial and necessary part of building your own system: practice and review. Practice leads to true knowledge, and reviewing can bring progress.

Backtesting requires reviewing each trade, weekly reviews, and notes can greatly assist you in summarizing and enriching your reasoning for opening trades, as well as perfecting your take profit and stop loss points.

A trading system is not built overnight; it is something to be summarized through continuous trading practice. Nobody is born understanding candlesticks or contracts; we all learn and summarize through exploration. Everyone has paid their tuition through losses. The important thing is that the tuition should not be wasted; learn from past mistakes to gain wisdom, and through failed trades, you will naturally understand what to do and what not to do in similar market conditions next time.

The above is a summary of my more than ten years of experience and techniques in trading cryptocurrency. It may not apply to everyone, and each individual needs to combine it with their own practice. As a trader, the most terrifying thing is not the technical problems you have but the lack of understanding that leads you to fall into these trading traps unknowingly! There is no invincible trading system; only those who use the trading system invincibly! This is the truth; trading systems ultimately return to the individual!

I am Xiao Xun, having experienced multiple bull and bear markets with rich market experience in various financial sectors. Here, I penetrate the fog of information to discover the real market. Seize more opportunities for wealth and identify truly valuable opportunities; don't miss out and regret!

Xiao Xun only conducts real trading; the team still has spots available.