Why do 80% of people lose their principal in the crypto market, while I can achieve financial freedom in 8 years with a 'foolproof system'? It's not that I have extraordinary talent, nor do I rely on insider information, but I have grasped the underlying logic of the market: living longer is 100 times more important than earning quickly. Today, I will break down my core strategy, which is not mystical but all practical insights, and there will be a surprise at the end.
In 2017, I ventured into the crypto market with 20,000 yuan in savings. At that time, mainstream assets were only a few thousand dollars, and I barely understood the underlying technology, but I held onto one belief: to find a replicable strategy and stick with it to the end. Over these 8 years, I have tried hundreds and thousands of indicators, from complex quantitative models to so-called 'insider points', and ultimately found that the most useful insights are hidden in the simplest logic. The greater the simplicity, the more easily a complex system can be swayed by emotions.
My core trading framework: Three lines determine the cycle, no guessing the market, just following the trend.
Many beginners like to watch dozens or hundreds of indicators, resulting in increasing confusion and ultimately making trades based on gut feeling. I have a framework validated over 8 years with only 3 core dimensions, free of any unnecessary distractions:
50 daily moving average = short-term emotional anchor: It acts like the market's 'weather vane,' quickly reflecting recent capital sentiment. When the price operates above the 50 daily moving average, it indicates short-term bullish dominance, allowing for trend-following layouts; falling below indicates a short-term weakening, reducing trading frequency.
200 daily moving average = cycle watershed: This is the 'compass' for judging the market's major direction, far more reliable than so-called 'bull and bear rhetoric.' When the price is above the 200 daily moving average, it indicates a strong cycle, and one can appropriately increase their position; if it falls below, it enters a weak cycle, and one should decisively reduce exposure or even stand aside.
Trading volume = signal verifier: A price breakout or pullback alone is a 'false signal' and must be validated with trading volume. For instance, when the price crosses above the 50 daily moving average, if the trading volume reaches more than twice the average of the past three months, it indicates genuine capital driven movement and doubles the signal's effectiveness; conversely, a breakout on low volume is likely a trap.
What impressed me the most was the key layout in 2017: At that time, after the mainstream assets broke through key points, the 50 daily moving average crossed above the 200 daily moving average forming a 'golden cross,' and trading volume increased threefold. I consolidated adjustable family funds + low-risk allocations and entered heavily; this wave directly elevated my account from six figures to the eight-figure threshold. Before the crash of a certain popular asset in 2022, my system had already signaled: after the price fell below the 50 daily moving average, trading volume continued to shrink. I reduced my position in time according to the rules, ultimately only incurring a small loss, avoiding the subsequent crash.
Three iron rules: Preserve your capital to wait for the market.
The harsh truth of the crypto market is: a single misstep can nullify all your previous efforts. I have survived these 8 years thanks to these three unwavering rules:
Single asset position ≤ 15%: I never put all my eggs in one basket, even for assets I’m optimistic about, I won’t exceed a 15% position. When a popular asset surged crazily in 2018, many around me went all in, while I only allocated 12% of my position, and later it plummeted by 80%. For me, it was just a minor fluctuation. Position management is not about being timid; it’s about providing 'insurance' for the principal.
Cut losses and take profits at breakouts: My rules are very mechanical, with no emotional coloring: when mainstream assets fall below the 50 daily moving average by 8%, exit immediately; when small and mid-cap assets fall below 5%, decisively cut losses. The market is always full of opportunities; what it lacks is the patience to preserve capital.
No more than 3 trades per month: The biggest misconception of beginners is 'frequent trading,' always wanting to catch every fluctuation, resulting in greater losses. I made this mistake too, losing quite a bit of capital in six months. Later, I set the rule of 'no more than 3 trades per month,' which allowed me to catch the bottom rebound in 2020 and the main upward wave in 2021. Less action helps filter out ineffective fluctuations and see the true trend.
The last trade: 80 million, I choose to exit.
Last week, I completed my final trade: after the mainstream asset tested the 200 daily moving average for the third time and stabilized, the trading volume shrank to a six-month low, aligning with the 'volume-price resonance buy point.' I allocated 8% of my position as planned, precisely taking profit after a 15% increase, and my account officially broke 80 million — this was the goal I set eight years ago in my rented room. At that time, I cut back on expenses, dedicating all my time to validating strategies, and no one believed I could achieve it.
While organizing my trading log today, I saw a sentence I wrote back then: 'Emotional strategies earn from short-term fluctuations, while simple systems that withstand the test of time earn from cyclical compounding and human behavioral dividends.' Now I finally understand: the crypto market will always have the next wave, but life only comes once. I am not taking a temporary break but truly saying goodbye — this system that has accompanied me for 8 years will be well preserved as a memento of this journey.
For you still in the market:
I am not recommending my strategy because everyone has different risk tolerances and personalities, and suitable methods vary. But one thing is common: the most valuable thing in the crypto market is not opportunities, but your capital; the most scarce thing is not skills, but the patience to persist long-term.
Find a strategy that suits you and stick to it; don't envy those who make quick money through luck. Respect those who can sustain profits. The market is always full of opportunities to make money; what it lacks are those who can survive until the opportunity arises.
Follow me, and next I will break down: ① Practical filtering techniques for the 50/200 daily moving averages; ② 3 buying signals + 2 traps of volume-price resonance; ③ The mathematical model of position management (to avoid single asset pitfalls). Reply 'strategy' in private message to receive a free trading log template that I have used for 8 years to help you build your own stable trading system.
The road in the crypto market is long; I will accompany you to avoid pitfalls and grow together. Your understanding is your greatest wealth.
