The recent market situation can be described as some are rejoicing while others are sorrowful.
Although Bitcoin has broken its historical high and reached $81,000, there are still people losing money in the market, and that is the truth.
In trading on financial markets, we need to stay clear-headed, calm, objective, and rational at all times.
Impulsiveness is a devil, and it is more direct in the crypto space; unlike traditional industries, any impulsiveness here is very evident — either you become wealthy overnight or you suffer losses.
But for the vast majority of retail investors, suffering losses is the final destination.
This market is even more brutal than the 80/20 rule; it’s basically a 90/10 situation. Even if it’s 80/20, the fact that only 20% of people enter means we are no longer losing money in this financial market. But does not losing money mean we will definitely make money?
Not losing money does not mean you will immediately make money; these are two different matters. To make money, you will definitely go through the process of transitioning from losing money to not losing money, then starting to profit, and finally achieving sustained and stable profits over the long term.
On the surface, it seems very simple and easy, but in reality, the number of people who can truly transition from losing money to making profits is very few, almost negligible.
Based on my personal experience, among my friends on WeChat, those who were so sure they would make money during the last bull market, even those who regularly invested in Bitcoin or Ethereum, at least 90% have exited the market. Even among those remaining, Bitcoin has hit a historical high, yet their accounts are still losing money — this is the harsh reality of the crypto space.
As I mentioned in my article a few days ago, if your positioning is for short-term trading, swing trading, or contracts, what does a bull market have to do with you?
There are plenty of short-term, contract, and swing trading opportunities every day. If you are clearly focusing on 15-minute, 1-hour, or at most 4-hour candlestick charts for trading, why worry about bull and bear cycles?
If your positioning and goals are unclear, always thinking you can conquer the world with one move, in the end, you will only hurt yourself.
In trading, if we cannot correctly change our thinking, have the right understanding, and avoid fundamental errors, the outcome will definitely be wrong. What is scary is when erroneous thinking brings about a temporary correct but fleeting result.
This leads us to the existence of 'obsessions' and 'illusions' in our subsequent trading processes.
Moreover, the vast majority of people cannot understand market trends or differentiate between cycle transitions. What they think is following the trend is actually going against it without realizing it, from the perspective of the correct investment philosophy.
They can stubbornly hold on during pullbacks, but whenever they need to break even, or when a true bull market surge arrives, they fear repeating past mistakes and losing the profits they have, leading them to liquidate.
In a bear market, fear and anxiety will not lead retail investors or newcomers to suffer significant losses.
But in a bull market, that is when retail investors and newcomers truly suffer big losses due to greed and ignorance, lacking respect for the market.
The results brought by trends can make you believe it is due to your own ability, unaware that this is just the beginning of a nightmare.
