Greed is like a snake swallowing an elephant; my position died on the eve of a surge.
Earlier, I thought it was my ability after hitting the rhythm several times, not realizing that it was just a bit of luck. Once you let your guard down, the bad news will eventually come.
At the core of stock and cryptocurrency trading is the need to overcome human nature.
Whether trading stocks or cryptocurrencies, if you want to achieve stable profits, you must have your own stable trading system. Once it exceeds the stop-loss line, decisively cut losses; when profit expectations are reached, exit quickly and wait for the next opportunity.
The most important point is position management. Many small investors, including myself in the past, often like to go all-in, believing that the price is right and that they can get rich overnight. Little do they know that the 'whales' have human psychology firmly in their grasp. As soon as there is a sudden large fluctuation, you will quickly die in the darkness before dawn.
Especially with leveraged contracts, the underlying factor remains position control. Even if you are using 100x leverage, if you only enter 0.01% of your entire position, you can handle almost all emergencies without your mindset collapsing.
Everything has been summarized by countless predecessors; it's just that most of us operate based on our human nature in trading. Why do many beginners initially make a profit, but over time they consistently incur losses? Logically, the longer the time, the more experience one should gain, which should lead to better outcomes.
If everyone reflects carefully, they might recall being particularly cautious at first, only entering the market at low points and taking partial profits after gaining around 10 points, waiting for the next opportunity. But after witnessing many explosive opportunities, when prices skyrocket, you become eager to chase the rise. A few successful trades give you a taste of sweetness, and your vigilance gradually diminishes. The final outcome is often buying high, suffering a painful loss after your position drops significantly, and when the price hits a low point, you fear it might drop even further, thinking that this junk coin will be delisted. Once it rises again, you find hope in it, and this cycle continues, leaving your position nearly depleted.
Many people have likely experienced the things mentioned above, and I have too. Excluding human nature, relying solely on many technical indicators is still very useful. I have always wanted to trade directly using machines to eliminate human factors. I found that Binance has its own trading bots, but after using them for a while, I realized they were basically treading water. After some ups and downs, in the end, I was just paying fees to Binance. After searching around, I found that some institutions are also doing quantitative trading, planning to take a look, but the prices were outrageously high. Not to mention the effectiveness, just the cost alone was painful. With AI being so advanced now, summarizing technical indicators and quickly implementing the relevant code should not be a problem.
Once I decided to do it, it took about six months from having the idea to achieving preliminary results. During this time, I also had to engage in stable, profitable work during the day—working a job—then I would come home at night and work hard. By midnight, my wife started scolding me, and I wouldn't go to bed. I can say I was full of passion but also extremely exhausted. Why did it take so long? Because I needed to research and verify, and there weren't many references; it was all trial and error. With my experience in stock and cryptocurrency trading, along with some general AI summaries, I took many detours and gradually had some insights. In fact, implementing the relevant interface was quite fast; the key was that fine-tuning the technical indicators took a lot of time, and verifying the effectiveness of the indicators is still ongoing.
I can show everyone some of the current results. Some key technical points are that every stock or virtual currency has a cycle; of course, the cycle of junk coins is noticeably shorter than that of stocks, but the volatility is much greater. With anything volatile, if it rises too much, it will eventually fall, and if it falls too much, it will rise again. This is an unchanging principle: buy low and sell high, which is the basic logic for profiting from the price difference. Furthermore, under uncertain conditions, never short-sell. With 1x leverage, you can only profit a maximum of 1x, but losses can be infinite; your account margin can be completely wiped out. Conversely, when going long, with 1x leverage, losses are limited to the current contract position, while profits can multiply several times.
Another key point is to avoid trading in markets with an average daily trading volume that is too small, for example, less than 10 million. This indicates that the activity level of this trading pair is too poor. Additionally, avoid trading pairs that have been online for too short a time; the volatility is very erratic and hard to grasp, unless you have reliable insider information.
During my research, I also discovered that many air coins have nearly identical K-line fluctuations and trends. It can be confidently said that these trades are mostly executed by robots; they likely set a target and then let the robots run the data. If you are trading against these 'whales,' remember that stock traders have been playing with human psychology for decades or even hundreds of years. If you manage to make some small money, you should be grateful to yourself for your self-control and know when to be content.
Regarding the implementation of the software, my current approach is to integrate the technical indicators created by predecessors with some of my own experiences to design a new technical indicator. I currently call it the (Shou Zhu Dai To) Buying and Selling Index, similar to the BTC Fear and Greed Index, with values ranging from 0 to 100. Under conservative conditions, an index below 25 is a nice buying signal; of course, in the vicinity of this value, buying can be adjusted based on the situation—the lower, the better. Then it is essential to remember to control your position; ideally, keep each trading pair's position below 5%, avoid high leverage—at most 1-5x. For high leverage, reduce your position. As for selling signals, if you are patient, an index above 65 is a decent position; of course, you can start selling a bit from 50 onwards, and the larger the index grows, the more you should sell. Don’t fear earning less; if it soars in the future, don’t be anxious. The more it rises, the greater the risk, and a sudden drop could mean losses. Earning is the way to go; be a friend of time. As long as time is long enough, your money will still be in your hands, and it will continue to grow. They say compound interest is frightening; even earning a little every day, I believe you can sleep soundly every night.
Below are some data displays of various trading pair indicators. Please do not criticize harshly; if you find any inaccuracies or have suggestions, everyone is welcome to discuss.
