'Excited to enter the market, cursing while leaving', but last week my cousin's operation directly made me lose 1200 dollars of principal, going from 0 to 38,000 dollars in 4 months, with zero liquidation! The key is that he had no insider information, nor was he a technical genius; he relied entirely on the 'anti-human survival method' I taught him. Today, I'm breaking down the fundamental knowledge for you; if beginners follow it, they can at least lose 80% less. Don't wait until you've lost everything to come back and reflect!
First, let's break a misunderstanding: if you want to survive with a small amount of capital, don't think about 'how much to earn' first.
I have encountered hundreds of small capital players, and 90% of their fates are the same: as soon as they enter the market, they focus on 'hundred times coins', follow the crowd in the group shouting 'go all in', and as soon as the K-line jumps, they get itchy and open positions, resulting in their accounts going from four digits to two digits, cursing 'it's all a scam' and leaving.
But the truth of the crypto market is: the core of small capital isn't 'making quick money,' but 'not dying before dawn.' My cousin can succeed because he took the right first step — giving 1200 dollars 'triple insurance,' and diversifying is the key to risk resistance.
1. 400 dollars 'trial error position': practicing discipline is more important than practicing technique.
I made him use this part of the money specifically to 'cultivate patience,' only trading mainstream coins like BTC and ETH on a 5-minute short line, with two strict rules:
Take profit after gaining 3 points (make 12 dollars from 400 dollars and withdraw immediately, even if it goes up later);
Cut losses of 2 points immediately (if losing 8 dollars, don't hesitate; don't wait until it loses 10 dollars to feel sorry).
I even forced him to set a phone timer; no matter how 'tempting' the K-line looks, he has to close the software at the appointed time. In the previous month, he made the most of 3 trades in a day and lost 2 trades, but overall he didn't lose — the key was embedding 'not being greedy, not holding onto positions' into his bones. Many newbies fail because they think, 'Just wait a bit, it might come back,' but the longer they wait, the more they lose.
2. 400 dollars 'hunting position': wait for the 'big fish' to shoot, a maximum of 10 times a year.
I made him value this part of the money more than his life, and he must wait for the 'weekly level certainty signal' before taking action — for example, when mainstream coins stabilize at key support levels with increased volume, or break through previous consolidation platforms (like that wave last November, ETH entered the market after stabilizing at 1800 dollars).
Before opening a position, I forced him to calculate the 'profit-loss ratio': how much to stop-loss, can the take-profit reach more than 3 times the stop-loss (for example, stop-loss at 50 dollars, take-profit at least 150 dollars); if it doesn't reach 1:3, even if the market looks like 'giving away money,' you can't move. Last year, he relied on this position and made 120 dollars in 12 days, which is 30% of the hunting position principal — remember, small capital doesn't mean no opportunities; it's about waiting for 'big opportunities,' not catching every small fluctuation.
3. 400 dollars 'trump card position': lock it in a cold wallet and let his dad set the password.
This step was my idea for 'cutting off the escape route' — directly transferring to a cold wallet, with the password set by his dad who doesn't understand encryption, charmingly named 'to leave you a way to come back to life.' Last December, the market fluctuated wildly, and he lost 120 dollars in a trial error account, but he didn't panic because he knew he had a trump card. Many newbies fail because they don't leave an escape route; they panic when they lose and then misoperate, losing even more.
80% of the time spent watching the market is 'busy work'; don't be a 'sycophant' to the K-line.
The most messages I receive daily are 'Teacher, I've been staring at the market until my eyes hurt, why am I still losing?' — because 80% of the market is 'deceptive fluctuations'! Just like the small ripples on the water surface when fishing, if you keep pulling the rod, you definitely won't catch any fish.
I had my cousin focus on just two time points: check the daily trend at 9 AM (to judge if the big direction is correct) and check the weekly structure at 8 PM (to see if there are big opportunities). The rest of the time, he should work out or binge-watch shows. He later told me, 'I used to think I would miss opportunities if I didn't watch the market, but now I realize the missed ones were all traps.'
The real opportunities are 'breakouts with increased volume' or 'daily line breaks'; only then should you enter with hunting positions, as the win rate is higher. Newbies shouldn't think of themselves as 'full-time traders'; with your little capital, there's no need to stress until you lose all your hair.
The most counterintuitive step: profits must be 'withdrawn'; don't let profits turn into bubbles.
This was the key for my cousin to go from 1200 dollars to 38,000 dollars, and it's also the 'safety cushion rule' that I emphasize repeatedly: as long as the total profit of the account exceeds the principal by 20% (for example, going from 1200 dollars to 1440 dollars, earning 240 dollars), immediately withdraw 30% of the profit to convert to fiat currency — withdraw 72 dollars from 240 dollars, either to buy milk tea for his girlfriend or save it as a fixed deposit, and never reinvest it.
He withdrew cash 6 times in the last 4 months last year, making over 2300 dollars just from this part. Later, when the market corrected, others lost all their profits, but his 'milk tea money' remained secure. I often say, 'Until the profit is in your pocket, it's just a numbers game.' Newbies love to reinvest their profits, ultimately losing even their principal; why bother?
5 'Addiction Prevention Rules': Controlling your hands is more useful than any technique.
In the end, I forced my cousin to follow 5 rules, and now he can achieve a 30 times annualized return with a maximum drawdown of only 7.4%, relying on these 'no mistake' bottom lines:
All operations must be done on a computer, set a single transaction 2% automatic stop-loss (a maximum loss of 8 dollars from a 400 dollars position automatically closes), manually cancel once, and penalize yourself by not being allowed to operate for a week;
When profit reaches 4%, first close half, and set a trailing stop for the rest (for example, if it breaks below the 1-hour MA10 moving average, sell all), don't think about capturing the whole wave of the market;
If there are two consecutive days of losses, stop trading for 48 hours, even if the market looks like 'picking up money,' don't touch it — when emotions collapse, all operations are wrong.
Only trade within 3 mainstream coins you've researched; those 'hundred times new coins' pushed in the group? Block them directly; 99% are scams.
Every Sunday night, you must write an 'operation diary': where you made profits, where you lost, and which step was a violation; writing it clearly can help you make fewer mistakes.
To speak from the heart: in the crypto market with small capital, 'slow is fast.'
I have done crypto analysis for 8 years and have seen too many people come in with the mindset of 'betting for a comeback,' only to lose even their principal. The market has opportunities every day, but your capital is limited; don't treat one opportunity as if it's the last chance.
Next, I will continue to break down 'small capital practical skills': like how to judge the key support levels of mainstream coins, how to set mobile stop-losses without giving back profits, and how to adjust mentality after consecutive losses... Follow me, and next time I update, I will push it directly to your homepage, so you don't miss out on practical insights.
