At that time, I organized all transaction records and looked through them carefully many times. My feelings were mixed; I still have a deep impression. There were over 1000 transaction records, of which nearly 700 were losses, and only a little over 300 were profitable. Overall, it was a big loss with small gains, and more than 200 were significant losses, so the overall result was a loss during those years. Looking at this trading record reveals a significant problem; the first reaction is greed. Seeing those big losses reminds me of the situations during those trades; unwilling to sell when there’s a profit and reluctant to stop-loss when there’s a loss, which fundamentally caused the final big losses.
There are also some small losses primarily due to unclear current thinking, lack of grasp, operating with luck, insufficient research, and entering blindly, leading to many small losses that accumulate to a significant amount. Ultimately, it all comes down to unclear or unsteady entry points. After summarizing, I realized that the truly good entry points should be at the starting point of a price rise. Many unclear entry points occurred during periods of range fluctuations when the situation was uncertain, leading to an increase in small losses, akin to boiling frogs in warm water; by the time I realized it, it was already too late.
In summary, I reflected, listed problems, thought a lot, and truly invested all my thoughts into it. Later, I thoroughly researched the techniques and dry goods, and summarized them into my own methods, which I now use with ease!
Today, I share this with my fans, hoping it helps you. If you find it useful, remember to like and save it!
Having experienced the rain, I want to hold an umbrella for everyone; heartfelt words ❤️
Like all beginners, I watched Bitcoin rise from 789 to 19783, and FOMO (Fear of Missing Out) kicked in, so I went all in, only to see a 40% drop a week later... But now my investment portfolio has outperformed the market by 470%, and the key lies in the method of rolling positions:
● Adding to a position with floating profits: After gaining floating profits, consider adding to your position. However, you need to ensure that the cost basis has been lowered to reduce the risk of loss. This does not mean blindly adding to positions after making profits; it should be done at the right time.
● Bottom position + T-trading rolling operation: Divide funds into several parts, leaving a portion of the bottom position unchanged while conducting high-sell-low-buy operations with the other portion.
Specific ratios can be chosen based on personal risk preferences and capital scale. For example, you can choose to roll over with half the position, maintain a bottom position with 30%, or roll over with 70% of the bottom position. This operation can reduce holding costs and increase profits.
I believe there are mainly two types of 'the right time' in a definition:
1. In a converging breakout situation within a trend, increase your position, and quickly reduce the added position after breaking through to catch the main upward wave.
2. Increase trend positions during pullbacks in the trend, such as buying in batches when prices pull back to moving averages.
There are many specific ways to operate rolling positions, the most common being to adjust the holdings. Traders can gradually reduce or increase their positions based on market changes to achieve profitability. Traders can also use trading tools like leverage to amplify returns, but this also increases risks.
Three factors to pay attention to in trading:
First, the factor is mindset.
Second, is the truth of human nature.
Third, be diligent in learning and enhance your understanding. My journey to wealth in cryptocurrency: from 1000 to financial freedom.
I never thought that in just a few years, my life would undergo earth-shattering changes because of digital currency.
In 2017, with a try-it-out mentality, I bought my first Bitcoin for 1000 RMB. At that time, the price of Bitcoin was hovering around a few thousand yuan, and I didn't expect it to rise much. However, in just a few months, the price of Bitcoin skyrocketed, and my 1000 RMB turned into tens of thousands.
Having tasted success, I began to delve deeper into blockchain and digital currencies, gradually investing in mainstream coins like Ethereum and Litecoin. I learned to read candlestick charts, analyze market trends, and even participated in the private placements of some early projects.
In 2018, the cryptocurrency market welcomed a bull market, and my assets also soared. I seized the opportunity, acted decisively, cashed out some digital currencies, and bought my first home in the city center.
Of course, the cryptocurrency market is not all smooth sailing. The bear market in 2019 caused me significant losses, but I did not give up; instead, I chose to continue learning and accumulating knowledge. I firmly believe that blockchain technology is the future trend, and the value of digital currency will ultimately return.
In 2020, the rise of DeFi (Decentralized Finance) reignited enthusiasm in the cryptocurrency market. I keenly captured this trend, actively participated in liquidity mining and staking, and gained substantial returns.
Now, I have achieved financial freedom, but I still maintain my love and exploration of blockchain technology. I am well aware that the cryptocurrency market is full of opportunities but also harbors risks. Only by continuously learning and maintaining rationality can one navigate the turbulent seas of cryptocurrency.
My experience sharing:
Learning is fundamental: Understanding blockchain technology, the principles of digital currency, and market trends are prerequisites for investment.
Rational investment: Do not blindly follow the crowd; invest based on your own risk tolerance.
Diversification: Do not bet all your funds on one project; diversifying investments can reduce risk.
Long-term holding: The cryptocurrency market is highly volatile, and holding quality assets for the long term is more likely to yield substantial returns.
Stay calm: Do not be swayed by market emotions; maintaining a calm mind is essential for making correct decisions.
The story of getting rich in cryptocurrency is certainly enviable, but the risks and sacrifices behind it cannot be ignored.
Establish a brand-new trading discipline.
When you acknowledge that your own issues have led to losses, you can start to build a brand-new trading life. You can start to design the discipline of a winner.
If trading excites or frightens you, you cannot fully mobilize your intelligence. When excitement makes you float, you will make irrational trades, leading to losses. When fear dominates your mind, you will miss out on profitable opportunities. Professional investors use their minds and maintain a calm mindset; only amateur investors will swing emotionally because of trading. In the market, emotional reactions are an unaffordable luxury.
Greedy amateur investors trade too frequently; even when there are not many good trading opportunities, they still want to trade. Before they understand what is happening, a series of losses can destroy their careers.
Formulate a set of methods to analyze the market, meaning 'if A happens, then B is likely to happen.' The market has many aspects, and multiple analysis methods should be used to validate trading decisions. Everything must be checked against historical data and subsequent market performance, using real money. The market is constantly changing; different trading tools should be used in bull, bear, and ranging markets, and there should also be a way to distinguish between them.
The mindset, feelings, and actions of winners are very different from those of losers. You must conduct an in-depth analysis of yourself, discard illusions, and change your previous thinking and behavior patterns. Change is difficult, but if you want to become a professional investor, you must work hard to change your personality.
Three essential qualities of a trader:
First, passion. You must love this market; if you are only in it to make money and do not love trading, it will be difficult to persist in this market.
Second, courage. This courage is not the courage to open a position, but the courage to acknowledge your mistakes. When you are wrong, do you have the courage to decisively stop-loss?
Third, discipline. For every trade you make, you must have a plan. Where is your stop-loss? If it really reaches that risk control point, you must execute it without hesitation. These three points are actually very important. The success or failure of investments is determined by the trader's psychology, attention, and personal thinking patterns.
To become a successful professional investor, the following principles must be followed:
1. Make a firm decision to stay in the market for the long term, meaning you must commit to being a trader for at least the next 20 years.
2. Learn as much as possible. Pay attention to expert opinions, but also maintain a healthy skepticism. Ask questions; do not simply accept things.
3. Do not be greedy, do not rush into trading, take the time to learn. There will always be more good opportunities in the future market.
4. Develop a set of methods to analyze the market, and use concentrated analysis methods to validate trading decisions. Different trading tools should be used in bull markets, bear markets, and ranging markets, and there should also be a way to distinguish between them.
5. Formulate a capital management plan. The primary objective must be to survive in the long term; secondly, to achieve stable asset growth; and only thirdly to obtain high returns.
6. Be aware that traders are the weakest link in any trading system.
7. The mindset, feelings, and actions of winners are very different from those of losers.
Trends and range fluctuations:
1. The techniques for trading in a trend differ from those for trading in a range. The difference lies in handling the strength and weakness relationship. When a trend is sustained, you must follow the stronger side, i.e., buy in an uptrend and sell in a downtrend. In a range, you must operate in reverse, buy the weak and sell the strong, i.e., buy when it drops to support and sell when it rises to resistance.
2. If the market is in a range and you are waiting for a breakout, you must decide whether to buy in anticipation of the breakout, during the breakout process, or after a confirmed breakout. If you are operating in portions, you can buy 1/3 of your position during the anticipated breakout, 1/3 during the breakout, and 1/3 during a pullback. Regardless of the method used, you must apply capital management principles to avoid risks, which means the distance between your buying point and protective stop-loss should not exceed 2% of your total capital.
3. The capital management techniques in a trend differ from those in a range. In a trend, positions should be set low with wide stop-losses, whereas in a range, positions can be set high with narrow stop-losses.
Use rules to solve stop-loss and position opening, use trends to determine profit-taking, use trends to interpret probabilities, use probabilities to resolve beliefs, and use profits to increase confidence. Thus, you can definitely become a winning trader!
