In the field of cryptocurrency investment, achieving profitability is not without its principles. Here is a practical trading strategy that has been tested and proven to help you improve your chances of making a profit.
Step 1: Select potential coins for your watchlist
Focus on coins that have made it to the top gainers list within the last 11 days, as these coins often exhibit a certain level of market activity and upward momentum, indicating significant potential. However, it is particularly important to decisively exclude coins that have experienced three or more consecutive days of decline. This is because continuous declines may suggest that funds have already exited with profits, and the subsequent trend carries a high level of uncertainty. If we rashly choose such coins, we may find ourselves in unnecessary risk.
Step 2: Use monthly MACD indicators for filtering
Open the candlestick chart of the coin and focus on the monthly level. At this point, we only pay attention to coins that show a bullish crossover on the MACD indicator. A MACD bullish crossover is often seen as a reliable technical signal, indicating that the coin may be in the early stages of a bullish trend over a longer period, providing important reference for our subsequent investment decisions.
Step 3: Enter precisely using the 60-day moving average on the daily chart
Further switch to the daily candlestick chart, where we focus on a key 60-day moving average. When the price pulls back to near the 60-day moving average and a high-volume candlestick appears simultaneously, this is a highly valuable entry signal, and we should decisively enter with a large position. The appearance of a high-volume candlestick indicates significantly increased trading activity near that price level, with high attention from funds, while the 60-day moving average serves as an important support and reference line. The combination of the two provides us with a relatively low-risk, high-reward entry opportunity.
Step 4: Manage positions and control risks based on the 60-day moving average
After entering the market, we use the 60-day moving average as a key standard for position management, adopting flexible operational strategies:
When the price increases by 30%, sell one-third of the position. This operation helps us gradually lock in some profits during the price rise, reduce holding costs, and also leaves some room for subsequent market changes.
When the price increase exceeds 50%, sell another one-third of the position. At this point, the market may already be at a relatively high level, and by selling in batches, we can continue to manage potential market reversal risks while ensuring existing profits.
Most importantly, if an unexpected situation occurs the day after buying and the price directly falls below the 60-day moving average, we must exit all positions without hesitation. This is a core risk control measure in the entire investment strategy. Although the probability of the price falling below the 60-day line is relatively low due to the combined method of selecting coins based on monthly and daily lines, the market is unpredictable, and we must always maintain a high level of risk awareness. Once such a situation occurs, any sense of chance could lead to significant losses of principal. Even if we have already sold, if the same coin meets our buying criteria again, we can still buy back in to seize new investment opportunities.
It is important to clarify that in cryptocurrency investment, methods are certainly important, but even more critical is the strict execution ability. Many investors may know the correct investment strategies, but in practice, they find it difficult to overcome human weaknesses and cannot strictly follow the rules, ultimately leading to investment failures. For example, the simple yet crucial rule, 'If the price directly falls below the 60-day moving average, then you must exit all positions without any sense of chance,' often becomes the key distinction between profit-makers and losers. Investors who can truly adhere to this may have already surpassed 90% of their peers. But it is also important to remember that investing in cryptocurrency carries high risks, and market conditions can change at any time. Investors should make cautious decisions, reasonably control investment amounts, and avoid unnecessary losses caused by blindly following trends.
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