Who hasn’t experienced losing half a month's profit in 10 minutes? When my contracts were liquidated back then, the green light from the computer screen hurt my eyes and my cigarette shook to the ground. This is the first lesson the crypto world gives to all those who are overly eager for quick gains: surviving is 100 times more important than making quick money!
Now I can steadily profit in the market, relying not on some 'get rich quick scheme', but on the discipline ingrained in my bones through 'anti-human nature'. Today, I will share my survival system from the bottom of my heart; new traders can follow it and at least avoid 80% of liquidation pitfalls!
1. Position management: 3% for the first position is my line of life and death
The most harmful lie in the cryptocurrency space is 'all-in for big money'—those who flaunt profit screenshots are either photo-shopped to deceive newbies or gamblers who will eventually have to pay back.
I am currently sticking to the '3% first position iron rule': 1000U capital, the first trade only opens 30U for trial and error. Don't think it's conservative; in extreme market conditions, this 30U can help you preserve 97% of your capital and provide countless opportunities to turn things around.
My scaling logic is more stringent: only when unrealized gains exceed 50% do I dare to increase my position in batches; the total position is never allowed to touch the 20% red line. More importantly, the third time I increase my position must wait for on-chain data verification (such as capital inflow, changes in holding addresses); adding positions without verification is all traps set by the main force to lure in excess; I've stepped into those pits, and you shouldn't again!
2. Stop loss discipline: Changing a stop loss once increases the risk of liquidation.
Stop loss is not about giving up; it's about setting a 'cap price' for mistakes. Many beginners don't misjudge but panic when they see paper losses, always wanting to 'wait a little longer', resulting in deeper traps until they are liquidated by the market.
My hard rule: A single trade's loss must never exceed 2% of total capital. With 1000U capital, I can only lose a maximum of 20U, which means even if I hit stop losses 5 times in a row, I still have 90% of my capital to fight again.
Specific operations in more detail: set stop loss points in a price range of 0.8%—this is the normal fluctuation range of mainstream currencies, which can avoid most of the market noise and won't get shaken out by oscillations. More importantly, once the stop loss is set, it's like signing a life-and-death contract with the market: the hours between 1-3 AM are the 'devil's window' (Asian players are fatigued, and Europeans have not taken over, all fluctuations are traps); I directly lock in automatic stop loss; if I feel like changing it? First, slap myself; changing a stop loss once brings you closer to liquidation!
3. Trend following: Beginners shouldn't get too fancy; EMA dual lines are enough.
The biggest risk in the cryptocurrency space is not price volatility, but your inability to even understand whether the market is rising or falling. Trading with the trend is the only way for retail investors to survive.
I never look at a bunch of flashy indicators, relying solely on EMA dual lines to set direction:
When the short-term EMA is above the long-term EMA: only go long or watch (never go against the trend to catch a bottom);
When the short-term EMA is below the long-term EMA: only go short or stay in cash (never blindly chase highs).
Also remember the 'Golden Spider' and 'Dead Spider' patterns: the 5-day, 10-day, and 20-day moving averages intertwining and then diverging upwards (Golden Spider) is a reliable bullish signal; conversely, it is a bearish warning. But remember, during sideways fluctuations, all these signals are garbage; it's better to miss out than to make a mistake.
Key for beginners: Don't get dizzy from the surges of altcoins! BTC is the market's stabilizer, with the most stable trend; ETH is the leading ecosystem that can drive altcoin movements. Follow these two for contracts, and your win rate will double, which is 10 times more reliable than blindly guessing altcoins.
4. Mindset management: In trading, what ultimately matters is 'not making mistakes'.
I have seen technically proficient individuals who collapsed mentally after two consecutive stop losses, revenge trading wiped out their accounts; I have also seen average players who, with a calm mindset, consistently profit each month.
Share my 3 iron rules of mindset; those who follow them will benefit:
If you hit a stop loss 2 times in a row, immediately close the software! Go out for a walk, watch a movie; if you dare to open another position, just hand your account password to a friend—at this point, your judgment has already diverged from the market; more operations lead to more mistakes;
Be more vigilant when making profits than when incurring losses! After making money a few times, you get carried away and want to increase your position to 'earn more'? This is the most fatal illusion in the cryptocurrency space; I have seen too many people give back their profits along with their principal to the market.
Never engage in 'revenge trading'! Losing money makes you want to immediately recover, just like a gambler who has lost too much in a casino; in the end, you will only lose more and more.
5. Retail winning logic: Trade less, calculate risk-reward, take profits.
The core of long-term profit in the cryptocurrency space has never been about magical indicators, but rather a survival system that avoids 'crashes':
Only earn money within your understanding: Others profit from MACD, but you can't learn it; others profit from on-chain data, but you can't keep up. Mastering the combination of EMA + position management + stop loss to perfection is more useful than learning 100 techniques;
Give up the fantasy of 'catching every wave': 90% of market fluctuations are noise; there are only 1-2 genuinely worthwhile opportunities in a week; less trading = fewer mistakes;
Calculate the risk-reward ratio before opening a position: potential gains must be more than double the risk (for example, making 200U with a risk of 100U); if not, no matter how enticing, just walk away;
Regularly take profits! This is the most critical step: when profits reach a certain level, forcibly withdraw the principal and half of the profits, leaving only the 'profit buffer' in the market; this both controls risks and provides positive incentives, stabilizing your mindset.
Finally, let me say something from the heart:
There is no myth of 'making a hundred times in twelve days' in the cryptocurrency space; only survivors who have ingrained discipline in their bones. Before each trade, I must ask myself three questions:
Does this trade align with the trend?
Where should the stop loss be set?
Is the risk-reward ratio sufficient?
Only when all three answers are clear do I dare to hit the confirm button. The market is never short of opportunities; what is lacking is the capital and patience to survive until the bull market.
