1. In a bear market crash, no matter how much the coins you hold drop, quickly switch to coins in the top 30 by market cap.
2. Only look at the 4-hour chart; don’t care about the rest. If there are many green bars within three months and they are significantly different from the red bars, buy in and wait for an increase.
3. Change your mindset: during a bear market, focus on coins whose trading volume rapidly rises into the top ten; trade short-term and don’t hoard!
For those playing altcoins, the main trend still depends on Bitcoin's trend. If Bitcoin is falling, even if altcoins surge today, you should still trade short-term, take profits when you can because this is often a personal manipulation by the project team or market makers, and for many reasons, it's not a trend. Don’t just buy and hold; it’s very likely to crash completely tomorrow!
Reasons why new investors lose money in the cryptocurrency bull market:
First: At the end of a bear market and the beginning of a bull market, you hesitate to buy, having just experienced a bear market and still thinking with a bear market mindset, missing the best time to get in.
Second: In the mid-stage of a bull market, you hesitate to buy when the trend rises, always thinking to wait for lower prices; at this time, getting in could mean being trapped at the peak, making it impossible to enter.
Third: Unable to hold onto profits, frequent short-term trading, selling at small gains.
Fourth: Misuse of leverage leads to liquidation.
Fifth: At the end of a bull market, the market goes wild; under the pressure of profit, unable to resist massive temptation, frequently increasing positions chasing gains, leaving oneself standing guard at the peak.
To determine whether the bull market is still ongoing, the simplest strategy is to keep an eye on Bitcoin's movements. As long as there is no large-scale liquidation, it means the bull market is still in play!
From 100,000 to 10 million, I have summarized how to avoid risks in the cryptocurrency world!
Only after fully realizing the risks and experiencing the adverse consequences of those risks can one truly focus on how to avoid risks. My main experiences are as follows:
1. Do not go all in.
Since investing has very high uncertainty and significant risks, one should not go all in!
Going all in every time, there will always be a moment when you hit zero. I am the best example; shortly after entering the cryptocurrency world, I went all in on BTC and BNB, quickly bringing my funds close to 10 million, but later going all in on Metaverse projects and contracts led me to almost hit zero twice.
The principle of not going all in is actually basic knowledge in the investment field, something many investment gurus and books will tell you from the start, but I actually made this fundamental mistake.
Actually, new investors generally don’t go all in right away. When I started, I only invested 100,000. The problem is that if a small investment quickly yields high returns, the greed within will unconsciously be released, ultimately consuming rationality and leading to going all in.
2. Be cautious with leverage.
Unlike going all in, leverage should be used when appropriate. In relatively certain opportunities, especially in major uptrends, decisively leveraging can lead to significant gains. Those who began borrowing to invest in real estate twenty years ago belong to this category.
But using leverage is a high-risk operation in a high-risk category. What's more serious is that when people generally start to leverage in a certain investment field, it must be that this field has been growing rapidly for a long time.
Everyone sees people around them making money or even becoming rich with leverage, while those without leverage seem out of place. Holding cash or qualifying but not borrowing is the biggest foolishness! This was the case in China's real estate investment sector for decades.
This situation will bring many blindly following investors who, like me six years ago, lack basic understanding of investments. If you talk to them about the risks of leverage, they will impatiently tell you that housing prices absolutely will not fall.
If you want to ask why, it's simple: China will not let the real estate market fall.
Regardless of whether China's real estate market will fall, the complete lack of awareness of the risks of leverage, from an investment perspective, has already pushed oneself to the edge of a cliff. When and where one falls might just be a matter of time!
So how can we cautiously leverage? I think the three most important points are:
1) Leverage in the field you are most familiar with.
First, being most familiar with something can lead to a better success rate. Then, adding leverage is a significant test of mindset for most people. If you don’t understand enough, it becomes even harder to maintain your mindset, easily leading to irrational decisions, compounding mistakes until you hit rock bottom.
2) Before leveraging, you must repeatedly ask yourself if you can bear the worst-case scenario.
You can only leverage when the answer is certain! Here, you must be absolutely rational and extremely conservative; never deceive yourself—don’t blindly follow others, and avoid the gambling mentality!
For most people, a reliable approach may be to use small positions to leverage, betting small to gain big!
3) Once you smell risk, you should immediately reduce leverage or stop losses, even if it's just a hint! Losing money with leverage is much more stimulating than making money with leverage; those who have experienced it will remember it deeply!
Lastly, I want to emphasize that I am not encouraging everyone to leverage; I am merely emphasizing the risks of leverage and the issues to be aware of when using leverage, regarding whether to leverage or not.
It actually depends on the person. As I mentioned earlier, leverage is a high-risk operation within a high-risk category, more suitable for aggressive players with strong risk tolerance. If you are not this type of player, I suggest you don’t play.
