Yesterday, an 'old hand' in the cryptocurrency circle shared his experiences. I have no comment, as people have different views; the content is as follows:
The cryptocurrency world is like a university, but it is not a four-year program; it is an eight-year program.
As is well known, the cryptocurrency market has a four-year cycle.
If you are a complete beginner and do not understand the concepts of blockchain at all.
Only by experiencing two cycles can one truly 'graduate,' which means gaining freedom.
The first step in entering this university is to choose a major.
• Trading: high frequency, intraday, trend analysis, short-term speculation, spot trading, contracts, leverage, options...
• Play on-chain: engage with DeFi, NFT, GameFi, MEME, inscriptions, runes, new coin listings, and arbitrage...
• Engage in primary investing: investment research, participating in early-stage investments, seeking new tracks and narratives...
• Yield farming: account building, airdrops, multi-account strategies, and anti-scam measures...
• Engage in arbitrage: market price differences, cross-platform arbitrage, DEX-CEX arbitrage, Pendle market arbitrage...
• Brick moving: OTC, cross-border, cross-platform price difference trading...
In the first four years, you should be in the stage of rapidly accumulating funds.
At this point, your goal is survival, learning, and optimizing strategies.
Those starting from scratch or with very little capital can try high-frequency trading or small investments, continuously improving skills through practical experience and accumulating initial capital.
By the second four years, with funds and experience, your role should shift from speculator to investor.
• Focus on long-term trends and plan for promising coins.
• Understand the cycle rotation and grasp the rhythm of bulls and bears.
• Even participate in project construction
Ultimately, these eight years are a journey of cultivation; it’s not just about wealth growth but also a leap in cognition. After graduation, you will no longer worry about wealth but can truly choose the life you want to live.
How to become wealthy in the cryptocurrency market?
Today I will share a few methods, preparing a fund of 100,000 to 200,000 yuan.
Convert this money into stable coins and deposit it in reliable exchanges.
Then set it up to buy once a week, dividing this 100,000 to 200,000 yuan fund into 96 parts.
Among them, 60% should be invested in mainstream coins, 30% in promising coins, and 10% in platform coins.
Just waiting for one or two cycles, roughly 4-8 years, earning 1 million is quite hopeful.
This method is simple, and the competition is also small.
In reality, however, this process is not easy. During this period, one cannot operate casually, cannot be influenced by short-term fluctuations, and must have sufficient determination.
Second method: There are other ways, such as participating in airdrops, gaining whitelists, and investing in new projects.
But this is not easy; you need to know programming, operate remote servers, understand English, obtain first-hand news, be able to operate in bulk, and invest a significant amount of energy.
It's like becoming a scientist in the crypto world; you must continually learn and master various programming skills. Doing this requires a lot of time and effort, and success is not guaranteed.
Third method: This relies on a bit of luck. You need to pick a coin that can rise more than 10 times at the beginning of a bull market. This requires both luck and judgment.
You need to look at the size of the coin's traffic, whether the concept is novel, and who is backing it. Avoid unreliable promoters, or you are likely to be scammed.
This requires making more friends and seeking advice from others. The key is to keep your understanding up to date and to have decisive decision-making abilities.
I hope to become your beacon on the path of cryptocurrency trading in 2025, so you will never lose your way! First, let’s summarize a few reasons for losing money. Only by understanding why you lost money can you know where you can make money.
The trading mantra I summarized for cryptocurrency, along with my personal insights:
When trading old coins, choose the top brands. *Top brands include not only BTC and ETH but also leading coins in various tracks, such as the privacy coin Monero.
For trading new coins, prioritize well-known brands. A well-known brand refers to high popularity and recognition, and also includes investments from reputable investment institutions, which helps avoid junk coins.
Avoid domestic coins as much as possible. *Domestic coins are often subject to trend-following or short-term speculation, with weak innovation and many junk coins.
Old coins that have gone through a bull and bear market should be traded quickly. *Old coins that have been stuck for a long time may suddenly spike after long-term consolidation, but it's best to get in and out quickly. Instead of trading such underperforming and unpopular old coins, it’s better to trade new coins.
In a bull market, take long positions and do not short. *Go with the trend; even though there may be pullbacks, prices can recover, so taking long positions carries the least risk.
Accumulate coins according to the trend to create miracles. *Bull markets are suitable for coin-based strategies; earning more coins means earning more money.
In a bear market, short and do not take long positions. *In a bear market, it is better to follow the trend; although there may be rebounds, the likelihood of continued decline is greater, and one should not easily take long positions before a bottom is seen.
The safety of funds is paramount. *In a bear market, it should be fiat-based. The price of coins often drops by more than 90% in a bear market, so ensure the safety of your funds.
Do not worry about the truth of the news. *News is always flying around, true and false; one cannot trust too much, and the news seen from the media always has a lag.
Everyone's response is to gauge the market sentiment. *If there is good news and the price does not rise, then it is bearish; if there is bad news and the price does not fall, then it is bullish. One should not assume that good news means rising and bad news means falling.
Blind guessing and following others leads to no growth. *Many apps now offer copy trading features, automatically following the direction of big players’ trades. This is easily manipulated, and you won't learn the logic behind their trades, hence no growth.
Tech is the compass. *There are often two types of people in the trading market: those who trade based on news, whether the news is rumor or public, and those who are technical traders, judging direction through K-lines, volume-price relationships, and indicators. Personally, I believe that for well-traded cryptocurrencies like BTC, technical analysis is the most effective tool. However, for less traded coins, particularly early-stage coins with poor trading depth, news can have a significant impact on their prices.
Do not hope for luck. *It’s impossible to always have good luck, so maintain a normal mindset.
Do not expect to achieve success in one go. *Trading is not like winning the lottery; it's a probability game, and you cannot rush to achieve success. It is particularly crucial to pay attention to stop-loss and take-profit.
Achieving the unity of knowledge and action is extremely difficult. *Knowing is easy, but doing is difficult. Trading involves battling one’s own greed and fear; it’s an extremely challenging task.
Cultivation only happens through practice. *If you want to cultivate, why not just trade? Only by overcoming greed, hatred, and ignorance can you reach the unity of knowledge and action, be poor without anxiety, and rich without arrogance.
In a bull market, how to correctly accumulate coins? In a bear market, how to make trades?
Compared to stocks, futures, and other traditional financial trades, there are many more people making big money in the cryptocurrency market! Many ordinary people, or even those who are not as good as us, have become rich; how can we not be tempted?!
The temptation of getting rich can make people lose their rationality. Many people hold the view that if they find a few promising coins and invest heavily, they can wait to get rich or change their fate! The so-called promising coins refer to those that can increase a thousandfold or ten thousandfold!
Here, I must inform everyone of a fact. Those who get rich are, after all, a minority, and a pitifully small one at that. I do not deny that many people have become wealthy, but wealth is often temporary, or rather, it exists only in the account; if one does not withdraw it, leaving the crypto market, they will eventually lose it all. There are too many such examples. Take my classmates as an example. We learned trading techniques together. He was very lucky, starting with 20,000 yuan and earning 5 million in just six months. At that time, we were envious, even jealous. We also advised him to quickly withdraw the money to buy fixed assets like houses or gold, or to give most of the money to his family. As a result, everyone probably guessed it: all the money he earned was lost, and it was complicated and burdensome. So, how can we remain undefeated in the crypto market?
In a bull market, how should we correctly accumulate coins to make money?
First, find promising coins, invest half of your capital, and do not sell at least for half a year or a year; second, engage in swing trading. That is, with the remaining half of the money, continuously buy low and sell high to earn profits.
Specifically, how to buy low and sell high? I have summarized in my comprehensive trading system a simple trading system, meaning to use the trading system immediately. Simple means that any normally intelligent person can learn it in half an hour and master it proficiently in about a week. Because it uses only two tools: one is pivot points, and the other is trend lines. To use immediately means that the opening and closing positions are clear at a glance.
With a large bull market, there is also a large bear market. If during a bear market you still cling to the old mindset of buying low and selling high, you will often suffer significant losses. So, is there a good solution?
The solution is to short.
First, you can use leveraged trading to short; just use 1x leverage. Specific operations can be asked from customer service.
Second, use low-multiple contracts. Set the contract multiple to 1 and short with the entire position.
Specific shorting points still depend on the simple immediate trading system.
The simple immediate trading system is what I summarized after two months. Besides the above advantages.
There are also the following advantages:
1. Avoid human weaknesses, namely greed and fear. The buying and selling points are clear; buy when you should buy and sell when you should sell!
2. Applicable to all coins (including mainstream coins and altcoins)
3. Applicable over a wide range of cycles (15-minute charts and above can be used)
4. Avoids the dulling of indicators.
Finally, let me emphasize: during a bull market, only trade spot and avoid contracts!
The simple immediate trading system can be summarized in four words: simplicity is the ultimate sophistication.
I hope everyone does not underestimate this, as it reveals the laws of financial trading.
There are many methods for beginners to navigate the crypto world, and absolutely several methods are suitable for you right now:
There are many methods for beginners to navigate the crypto world, and absolutely several methods are suitable for you right now:
You have 1 million yuan in assets and decide to use 700,000 yuan to buy a cryptocurrency.
On the first day, this coin fell by 1%, and you lost 7,000 yuan, but you did not care, believing that the price would eventually rise.
On the second day, the coin price fell by another 3%, and you lost nearly 20,000 yuan, but you still firmly believed it would rebound.
On the third day, the coin price rose by 2%, recovering about 10,000 yuan of your losses, and your mood improved slightly, feeling that everything was under control.
On the fourth day, the coin price suddenly plummeted by 20%, and you lost 140,000 yuan, beginning to feel uneasy, hoping for a rebound the next day.
On the fifth day, the coin price rebounded by 5%, and you breathed a sigh of relief, feeling that trading has its rules.
On the sixth day, the coin price rose another 1%. Although the increase was small, at least there was hope for breaking even, and you felt satisfied.
On the seventh day, the coin price rose by another 1%, and you began to look forward to future movements.
On the eighth day, the coin price continued to rise slowly, but you remained optimistic in your heart, believing that there would eventually be a day to recover your investment.
On the ninth day, the coin price suddenly plummeted by 30%, and you began to panic, questioning whether you had chosen the wrong coin.
On the tenth day, the coin price fell another 10%, and you felt angry and disappointed.
On the eleventh day, the coin price entered a consolidation period, and you saw someone online calling it a bottoming signal, believing that the market is accumulating momentum, firmly convinced that the coin price is about to rebound.
In the following week, the coin price continued to consolidate. You went online to learn more about cryptocurrency, believing this was the 'major force accumulation phase' and thus continued to hold your coins.
A month later, the coin price not only did not rebound but continued to fall by 20%. You began to become numb, thinking that if you could just break even, you decided to withdraw your funds and distance yourself from cryptocurrencies.
But things did not go as planned; the coin price continued to decline. At this point, you finally understood the concept of 'stop-loss.' You were in pain and struggled inside, not knowing whether to liquidate your position or continue to hold.
At this moment, a friend tells you that a new coin has surged by 200% recently and shares his 'leading strategy.' You believe it, sell the coins you hold, and tell yourself to wait until you earn enough from the new coin.
The basic principles of Dow Theory, combined with the actual situation in the crypto world, can be summarized in six points:
First, average prices encompass and digest all factors. Fundamentals, policies, news, and capital can all influence supply and demand relations, and all of this will be intuitively reflected in the market, ultimately absorbed through price changes.
Second, the market has three trends. Dow categorized trends into three types: primary trends, necessary trends, and temporary trends.
The main trend is like the tides of the sea, representing long-term trends, similar to the seasonal cycles in the crypto world, with bull and bear markets cycling endlessly.
Secondary trends are the waves in the tide, representing pullbacks in the main trend, generally retracing to important Fibonacci levels of 38%, 50%, and 62%. Temporary trends are ripples, indicating minor fluctuations that are highly uncertain and change rapidly.
The third major trend can be divided into three stages. The first stage is the accumulation phase, similar to the yin and yang concept. It refers to the end of the bear market; although everyone is bearish, it has already fallen to the point where it cannot fall any further, and the main force begins to accumulate.
The second stage is the bullish attack phase, where positive news begins to emerge, and most retail investors with some technical knowledge gradually enter the market, and prices start to rise.
The third stage is a climax sprint, during which major media begin to flood with good news, boldly predicting further price increases. Retail investors buy actively, and no one wants to sell, fearing to miss this rare money-making opportunity. However, in reality, the main force that bought at the bottom has already begun to sell off.
Fourth, various average prices must mutually validate each other. For example, the combined rise of Bitcoin and mainstream coins must exceed the previous peak in the mid-trend to be considered the arrival of a large-scale bull market! Similarly, if the combined fall of Bitcoin and mainstream coins breaks below the neck line position during the high-level consolidation phase of the bull market.
Fifth, trading volume must validate trends. Dow believed that volume is second in technical analysis; when prices are developing along a major trend, trading volume should also increase correspondingly.
Sixth, only after clear and indisputable reversal signals can we judge that a given trend has ended. A significant trend has inertia and will generally continue to move in the main direction for a while, so you must wait for trend confirmation before reversing; for example, a head and shoulders pattern must break the neckline to be considered a trend reversal.
The Dow Theory is a macro technical analysis system aimed at capturing the most substantial movements in the market, which is also the most desirable segment.
Its advantage is that it is relatively successful in determining the major trends of bull and bear markets; however, its disadvantage is also evident, as the signals are usually delayed, and it often misses 20%-25% of the profit margin.
You need to have a big vision. What is a big vision? Many excellent investors around me have a big vision; they are not concerned with short-term gains and losses, and even when temporarily stuck, they remain calm, believing they will recover their investments. Therefore, their mindset is not anxious or hurried, and such a mindset often leads to calmer operations and easier profits.
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If you want to achieve stable profits, you must go through a few years of bottleneck period: half a year learning skills, one year practicing execution, and a year and a half practicing mindset. The most important thing is to minimize losses during the bottleneck period. If you are willing to invest time, effort, and summarize, along with having a good mentor, then the cryptocurrency journey will be much simpler. The stars shine brightly, as always.
You will definitely gain something; helping others is helping yourself. There are no bad markets, only bad operations. No matter how the market changes, I hope we can always walk together, and after ten years, we can still smile at the crypto world.
Once I have experienced the vastness of the sea, I can hardly regard any other water as good; excluding the misty mountains, I cannot consider any clouds as beautiful. The above are some insights from my ten years of trading, all heartfelt words. After many detours, I slowly found the path, and today I share this summary with everyone, hoping to help everyone’s understanding and thinking in cryptocurrency trading.
