In my opinion, the key to investing in digital currencies is to maintain a good mindset, while mastering the technical aspects is secondary. This calmness and composure may be the secret to my success in the crypto space, allowing me to navigate it with ease and reap substantial rewards.
So how to control one's mindset?
Here’s a little suggestion that I hope will be helpful to you.
1. Understand the essence of speculation: Distinguish between primary and secondary; primarily speculate while keeping it as a side job, viewing it as a new way of financial management. It’s a skill to earn money externally. However, if you treat it as a primary job (professional trader), then consider that I haven’t said anything.
2. No need to watch the market every day: There is no need to watch the market every day. Watching the market is the obligation of those who are in the circle. What most people need to do is to slowly put in their spare money, wait for it to grow in the pool, and then you can take it out. Trading cryptocurrencies is that simple; it’s not as difficult as you think.
3. View ups and downs calmly: In the process of investing, we need to maintain a peaceful mindset and not calculate how much we earn or lose every day.
Because regardless of the type of commodity, prices will always fluctuate within a cycle. They will drop during crazy times and recover during downturns. These fluctuations are quite normal; if you focus too much on short-term gains and losses, your mindset will follow the price fluctuations, and in the end, you will undoubtedly be the loser.
4. Remember not to be greedy: Do not expect to buy at the bottom and sell at the top every time. Avoid greed and panic. Treat every market fluctuation with a calm mind and do not seek to become a master at buying low and selling high; just go with the trend to achieve success. Otherwise, you may find yourself joining the ranks of 'masters' who buy at the top and sell at the bottom sooner than you think. Many investors hope to become 'masters' at buying low and selling high in real trading, always wishing their every trade can be perfect, but in reality, this method may lead to losses.
5. Control your emotions when chasing prices: Chasing prices and cutting losses, cutting off as soon as it drops, and chasing high as soon as it rises will only lead to self-inflicted losses.
6. Learn more about relevant knowledge: Understand the essence of digital currencies, learn more, and turn speculation into an investment; your mindset will undergo a complete transformation.
7. Do not be blindly pessimistic: People often say the market has fallen by half. Optimistic people say, 'Hey, look, the market value is still half.' Pessimists see a half-empty cup, while optimists see a half-full cup. Please maintain an optimistic mindset and don’t be swayed by the majority in the market, but rather align yourself with the minority. After all, success belongs to the few.
8. Not losing is also earning: It is better not to earn than to lose money. How should one view not making money versus losing money? For investors, not making money and losing money are two entirely different concepts. Not making money often indicates that your analysis and judgment are correct; it’s just that you lacked the courage to stick to your views and enter the market, missing out on a profit opportunity—just a bit of regret and disappointment. There will still be countless opportunities in the future, as long as you can summarize past lessons and maintain a good mindset to earn profits.
If you have to choose a trading method, it must be right-side trading.
If you are confused during trading and don’t know the trading direction, then firmly stick to right-side trading; this is the holy grail of trading.
Although the crypto space is a news-driven market and technical operability is not high, sticking to right-side trading can definitely help you survive and become familiar with the market. Perhaps you are a novice, just getting into the market, and don’t yet know what left-side and right-side trading are. Here’s a simple explanation: Left-side trading refers to trading actions taken before the market trend is clear, while right-side trading occurs after the market trend is clear.
Thus, it can be seen that left-side trading is predictive trading, while right-side trading is deterministic trading.
In the cryptocurrency market, if it is spot trading, we can only trade in one direction, so we only consider the bottom. However, if it is contract trading, it is a two-way market, where both tops and bottoms exist. Here, we mainly take spot trading as an example.
Firstly, left-side trading carries certain risks for ordinary traders. Since ordinary investors often lack sufficient information channels and deep market analysis abilities, buying in advance before the market bottom forms may lead to long-term capital being trapped. Additionally, predicting market bottoms is highly uncertain, and ordinary traders may face significant loss risks if they engage in left-side trading without sufficient evidence. In contrast, right-side trading is more stable.
Right-side trading emphasizes making moves only when the market trend is clear, which helps traders avoid the uncertainty risk brought about by market fluctuations. By observing the formation of market trends, traders can enter the market at relatively safe times, thereby increasing their chances of success in investments. Additionally, ordinary traders can leverage their flexible and agile advantages when engaging in right-side trading.
Compared to institutional investors, ordinary investors have disadvantages in terms of capital scale and information access, but their decision-making process is quicker, allowing them to respond to market changes more swiftly. Therefore, ordinary investors should fully utilize this advantage, patiently wait for the market trend to become clear, and then make investment decisions.
In actual operations, ordinary traders should adhere to the principle of rational investment, avoiding blindly following trends and impulsive trading.
By deeply analyzing market data and combining it with news trends, traders can more accurately judge market bottoms, thereby achieving better investment returns through right-side trading.
In summary, ordinary traders should adhere to a right-side trading strategy, treating market fluctuations with a steady and rational attitude, and avoiding the potential risks associated with left-side trading. By patiently waiting and conducting detailed analysis, traders can make wiser investment decisions once the market trend is clear, thus achieving long-term stable investment returns.
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