A Survival Guide for Newbies in the Cryptocurrency World
1. Capital Preservation
Protect Your Principal: Your principal is your lifeline; think about whether you can bear the maximum loss before making any moves. The market is not short of opportunities, but lacks sustained capital.
Compound Thinking: A daily return of 1% leads to 37 times a year; a single 100% loss means going to zero. Don't cling to fantasies of getting rich overnight.
Dynamic Balance: Allocate funds in three parts: 50% mainstream coins, 30% potential altcoins, and 20% stablecoins. Rebalance when the proportion exceeds 20%.
2. Trading Discipline
Follow the Trend: The trend is your moat; monthly > weekly > daily charts; consistent direction is a good opportunity.
Position Management: For beginner single assets, do not exceed 10%; adjust based on volatility for advanced trading, and use the Kelly Criterion to calculate ratios for experts.
Buying and Selling Strategy: Use an inverted pyramid for scaling in; the first purchase should not exceed 20%, add 30% after a 10% drop, and keep 20% to guard against extremes.
3. Psychological Warfare
Emotional Indicators: A USDT lending rate above 30% is a bottom signal, and when retail investors push coins, it signals a top; establish emotional indicators.
Stop-Loss Setting: Entry price - (ATR × 2) for stop-loss; if ATR is 5%, set stop-loss at -10%.
Patience in Waiting: In a bear market, hold both long and short positions, and capture upward waves; not trading is the hardest trading.
4. Cognitive Upgrade
Cycle Patterns: Bitcoin tends to peak 12-18 months after halving; each bull market has a new narrative but the essence remains unchanged.
Research Focus: Pay attention to the project wallet, net inflow of exchanges, large on-chain transfers, and other real data.
Information Filtering: Focus on genuine big players, block false news, and observe the fear and greed index.
5. Survival Evolution
Safety Assurance: Do not keep more than 10% in exchanges and diversify; keep 80% in hardware wallets, and choose audited protocols for 10% DeFi yield.
Bear Market Strategy: Dollar-cost average from the 7th to the 12th of each month, use the 200-week moving average + Puell Multiple to resonate and buy the dip, and hedge with options.
Ultimate Mindset: Don't go all in, keep cash, understand when to exit, and you can survive in the cryptocurrency world.