I have been trading cryptocurrencies for 10 years, and it was only 6 years ago that I explored a trading system suitable for myself, and it was only after the guidance of a master that I had an epiphany!
Although it cannot be said that one is rich, it can be said that stable profits have been achieved, at least allowing one to steadily outperform over 80% of people.
Long ago, I understood that an excellent trading system can effectively help investors invest. I also understood that without a trading system, doing investments without rules will inevitably lead to more losses than gains.
But summarizing a trading system is really quite difficult.
An excellent trading system is also counterintuitive; it requires you to overcome greed and fear, to be decisive, not to make subjective judgments, and to enforce strict execution.
True cryptocurrency trading masters follow a simple principle: repeating simple tasks leads to a high win rate of 98.8%. Learning this allows you to easily go from 100,000 to 10 million; just stick to this one model!
1. Splitting positions is not metaphysics; it’s a life-saving charm!
How to divide specifically?
For example, if you have 30,000 USDT, divide it into three parts, each part 10,000 USDT. Use only one part for each trade, and lock the rest in your wallet as if it doesn't exist.
Remember two numbers: Bitcoin maximum 10x, altcoins should not exceed 5x!
Even if you are confident that there will be a surge, don't be greedy! The higher the leverage, the easier it is for the exchange to wipe you out with a single needle.
For example: If you open a 10x position with 10,000 USDT, a 10% drop would vaporize your account. However, if you only open a 5x position, a 20% drop would be needed to be liquidated, doubling your margin for error.
Splitting positions also has a hidden function: it helps to manage emotions!
When someone loses money, they are prone to 'revenge trading', resulting in even greater losses.
After splitting positions, even if one day you impulsively blow up one part, the remaining two parts can help you remain calm. Can losing 10,000 be the same as losing 30,000?
2. High leverage = slow suicide; don’t be stubborn!
There are always those who refuse to accept: 'Old Wang next door made a BMW overnight with 100x leverage; why can’t I?'
Brother, Lao Wang won’t tell you he has blown up 10 accounts, nor will he say that his BMW was exchanged for a house deed.
The truth about high leverage is twofold:
1. Needle pinning is a cure for disbelief: Exchanges love you high leverage traders; a needle at midnight takes all your principal away.
2. Psychologically collapsing: Opening 100 times, feeling restless with a 1% price fluctuation, can you still operate rationally?
Remember:
- Bitcoin over 10x = risking your life!
- Altcoins over 5 times = free money.
The lower the leverage, the more confident you are to hold positions, and the more you can benefit from the trend!
Three major death methods of counter-trend trading:
1. Stubborn type: 'I don’t believe it will not drop!' — the result is losing all principal.
2. Averaging down type: 'If it drops again, I'll add to my position to average down!' — the result is that you run out of resources.
3. Metaphysical type: 'The K-line has formed a golden cross, it must reverse!' — the big players teach you a lesson with a large bearish line.
Correct posture: Better to miss out than to give away your head!
Is the market going crazy? Just watch! Missing out does not lose money, but losing money against the trend can be fatal.
A principle of trading solves two problems.
This principle is: buy strong, sell weak!
Why buy strong and sell weak? Are you also following this principle in your operations? If you don’t understand the reasoning behind it, think more about it; I won’t explain more here. Adhering to the principle of buying strong and selling weak will greatly improve your returns and reduce risks!
The first question is: The judgment of trends!
We all know that trading should follow the trend, and the probability of doing it correctly is greater than 50%. So which trend should we follow?
How to judge the trend and trend reversal? The issue of which trend to follow has already been resolved in the trading method because you have determined your operational cycle. After determining the trading cycle, discussing trends with others becomes meaningless, as the trend direction may differ depending on the operational cycle. Therefore, what others say about rising or falling has nothing to do with you. Just use your own trend judgment criteria to make clear judgments in your own cycle.
After making a clear judgment, only trade in the direction of the trend, which solves the issue of following the trend! Of course, there are also criteria for judging trend reversals, which is also to follow the trend! As for what method you use to judge, anything can work!
Trend lines and moving averages are good; they are simple and clear, with no subjective judgment involved!
The second question: The structure of the trend!
After clearly understanding the basic structure of trends, trends become clear and evident to you, no longer a tangled mess! So what is the basic structure of trends?
Is it approval? A? You? Say? In the end, it’s 'Say!' When you understand that 'Say' is an excellent position for both offense and defense, will you still trade blindly?
As I said, this is not a secret talk, and there is no issue of it not working once spoken. Because this is an unchangeable essence!
Dao is the bone that supports the framework of trading! Fa is the sinew that connects the inside and outside, and Shu is the muscle covering the outside; thus, trading reaches a complete state!
Patiently holding no positions, waiting for the trend and timing.
Patiently wait for the market's truly perfect trend; do not make predictive interventions; 'timing is everything', buy at the right time and sell at the right time. Trading is not something to be done every day; those who believe they must trade at all times overlook one condition: trading needs reasons, and they must be objective, appropriate reasons.
If you can evade the storms of a 'big wash', you can bring home the huge profits.
Only when the market shows a strong trend characteristic, or your analysis indicates that the market is brewing a trend, can you confidently enter the market.
The above are theories from predecessors; my understanding is: there are two reasons to enter the market:
1. A trend that can be clearly identified using your own analytical methods (a trend you can understand).
2. Signals for entry timing that have been fully tested and verified as 'certain'.
Knowing when to hold cash is wise; this statement has some truth. Holding cash is not difficult; it is just that when the trend lacks certainty, one should hold cash and not trade.
Patiently holding positions, waiting for the trend to conclude.
Trends have sustainability. My 'thoughts' have never made me a lot of money; it has always been my 'persistence' that has made me significant profits. Do you understand? It is my persistence! In an upward trend, your approach is to buy and hold tightly until you believe the upward trend is about to end.
It is rare to be able to judge correctly and remain steadfast at the same time; I find this is the hardest thing to learn.
The position taken by following the trend may yield significant profits, and you must not easily 'abandon ship'.
'Cut losses and let profits run'; the purpose of patiently holding positions is to maximize profits, and the key is how to close positions. Solving how to close positions can address the issue of patiently holding positions. After more than a year of repeated exploration, I have found a method.
Just don’t think about buying and selling at the highest or lowest points, use a shorter time frame, and exit on the right side. Although some profit is lost, it allows you to hold until the trend concludes and maintain consistency in closing positions.
Tips for improving profitability.
The market is a very magical market; it can bring enormous wealth to people, but most of the time, it brings sadness and joy, liquidation, and exit. Today, let's talk about the tips that successful veterans in the market possess.
Solve the following three problems, and you will be basically close to stable profits.
1. What ultimately allows investors to continue making profits?
2. How can one improve the profit-loss ratio in investments?
3. What are the tips for quickly flipping small funds?
The solution to these problems is to establish a mature trading system of your own and raise the system's success rate to over 70%, thereby controlling consecutive losses to no more than 5 times. Set the system's profit-loss ratio to 3:1 or even greater, and then through specific capital management methods, achieve a guaranteed win goal in every 10 trades.
To make a profit in trading, one must have a deep understanding of their trading system, firmly believe in their trading system, and possess the correct mindset and good trading attitude as prerequisites for investment success.
The investment market has proven countless times that 80% of people incur losses, and no one can change the natural laws of the investment world because these are the eternal ironclad rules of the investment world. This does not mean the stock market is mysterious or difficult, but rather because most people have an irresistible nature of doubting their trading system, and it is this fatal nature that ultimately leads to investment failure. Trusting the system, however, is the most crucial part of trading. Only by trusting your trading system can you find the key to opening the door to wealth.
The whole secret to successful trading lies in consistently sticking to your trading system.
Investment success is not about how powerful and excellent your tools are, but about whether you can use your trading tools well. On the road to wealth dreams, the most effective strategy is to focus on and stick to a good trading system. Focus and persistence can generate incredible power. When you can truly achieve this, you can create miracles that even you cannot believe.
Successful traders possess a firm belief that they firmly believe that sticking to a successful trading system is the only choice for small people to achieve great things. Doubting one's trading system is the beginning of investment destruction. Every successful investor has a unique quality that is having the correct mindset, a rigorous trading attitude, strong confidence, decisiveness, and an unyielding spirit in the face of failure. Even in the most difficult times of the system, they can trade completely according to the system because they know that success requires a grand vision, overcoming the shortsightedness of human nature, and having the patience and confidence to adhere to a fixed profit model.
Utilizing technical indicators to grasp the key to short-term trading, accurately interpreting trading volume and trends.
In the crypto market, short-term trading is the first choice for many investors. However, despite many participants, very few can make a profit. The reason is that short-term markets change rapidly, and if one cannot master necessary technical indicators and apply them reasonably in practice, it is difficult to achieve ideal returns in short-term operations.
Today, Mr. Su will share how to effectively apply short-term technical indicators to improve the success rate of short-term trading.
First: Pay attention to trading volume patterns.
Changes in trading volume can provide important clues about market trends. When trading volume shrinks, it usually indicates that both buyers and sellers lack confidence in future trends, leading to decreased market activity. This situation can be subdivided into two categories:
1. Market pessimism: If most investors do not have a positive outlook on future trends and sell off without anyone buying, the market will experience a sharp contraction in volume.
2. Market optimism: Conversely, if everyone is generally optimistic and actively buying but no one is selling, this will also lead to a sharp reduction in trading volume.
When trading volume is in an expanding state, it usually indicates that market trends are changing. At this time, both bulls and bears have significant disagreements on the future direction, trading is active, and investors should closely watch the next fluctuation direction, judging which side may prevail and act accordingly.
Second: Observe the changes in trend patterns.
In addition to trading volume, investors should also pay attention to chart pattern changes. Several important patterns include: W bottom, head and shoulders bottom, arc bottom, rising channel, etc. When these patterns break the upper neckline, they can be considered buy signals, but be sure to pay attention to the following two points:
1. Valid breakout: Confirming that the breakout is not false.
2. Low-level breakouts are more reliable: Breakouts at low levels are relatively reliable, while high-level breakouts may be traps set by big players to guide market sentiment to achieve the goal of unloading.
Stable operations should usually wait for the breakout of the neckline, observe the market's pullback situation, and then consider the timing of entry.
Third: Application of moving averages.
Short-term traders generally use five-day, ten-day, and thirty-day moving averages. Key signals include:
- Golden cross: When the five-day moving average crosses above the ten-day moving average, it is usually seen as a buying signal.
- Dead cross: Conversely, when the five-day moving average crosses below the ten-day moving average, it is a sell signal.
Moreover, if the three moving averages show an upward trend, it indicates a strong bullish market, and investors may consider building positions during pullbacks. Conversely, if moving averages trend downwards, one should follow the trend and consider shorting.
Fourth: The use of technical indicators; there are many technical indicators in the market, and investors do not need to be comprehensive, just familiarize themselves with a few commonly used ones. Two commonly used indicators are Stoch and RSI:
Stoch Indicator: When the K value is low (around 20%) and crosses above the D value twice, it is usually a good buying opportunity; when at a high level (over 80%) and crosses below the D value twice, forming a dead cross, it is a selling opportunity.
RSI Indicator: When the RSI value is between 0-20, it indicates that the currency is oversold, which is a buying signal; when it is between 80-100, it indicates overbought, which is a selling signal.
It is important to note that technical indicators have lagging characteristics and cannot be used alone as the basis for trading decisions. Some strong coins may continue to rise even when indicators are high, while some weak coins may continue to fall even when indicators are low. Therefore, when using technical indicators, be sure to consider other factors comprehensively.
Conclusion
Currently, market trends are highly volatile, and conditions are ever-changing. Therefore, it is recommended that investors adopt a fast in-and-out strategy and set stop-loss levels, with specific values depending on individual circumstances. If changes occur in the short-term market, decisively stop-loss to avoid greater losses. For short-term operations, any price fluctuation can be a potential opportunity, but the premise is to ensure the safety of the principal; otherwise, it is difficult to achieve profitable opportunities.
The truth about making money in the crypto market: the power of belief.
Belief is a kind of ability, believing in the power of belief.
The road to success is never smooth; it is always full of ups and downs, as we can clearly see from the current Huawei.
Investing in the crypto market is no different; no one’s success is simple, easy, or achieved overnight.
Those who tell you making money in the crypto market is as easy as breathing and that becoming rich can happen to you and me are either people who have not achieved results themselves or have ulterior motives; we must not let greed blind our eyes.
Just like someone once asked a monk: Buddhism says that people have reincarnation and karma; how can one make people believe it?
A monk asked: Can you see tomorrow's sun today?
Answer: Cannot see.
A monk asked: Do you believe the sun will rise tomorrow?
Answer: I understand, life is always about believing first, then seeing.
So do you believe first and then see, or see first and then believe?
Leader: Believe first, then see;
Follower: See first, then believe;
Losers: Even if they see it, they don’t believe it.
Isn’t trading in the crypto market the same?
Do you not believe in the laws of economic cycles? Do you not believe there will be bulls and bears in the crypto market? Do you not believe we are in a bull market now? Do you not believe that trading requires professionalism? Do you not believe that cognition is a prerequisite for achieving results?
Those who can enter the crypto world, I believe, are all smart people, but the financial market has never lacked smart people.
Smart people have many advantages; I won’t elaborate further, but one disadvantage is: they are often suspicious.
The vision and judgment of a smart person, as well as their ability to perceive and discover business opportunities, are often much stronger than those of ordinary people.
But because they are smart, they often come with discernment and judgment.
When it is beneficial to oneself, one is absolutely 100% confident; however, once they see a hint of something unfavorable, they choose to believe intermittently.
Smart people do not blindly persist; just like the rabbit in the tortoise and hare race, or the monkey that picks sesame seeds and drops watermelons.
Take the crypto world as an example; I believe many people have experience with copy trading:
After believing once, continuing to believe for the second time, after five times, the sixth time someone tells you the risk has arrived, the bull market is nearing its peak and you should escape, your suspicion comes out: what if I’m wrong this time? Wouldn’t I miss out on a lot of profits?
There are also those who believe in one community today and another tomorrow, who worship after one or two instances and start to doubt when things go wrong.
Yet, very few truly focus on their own cognition and ability growth. Do those who follow others' trades naturally know trading techniques and strategies?
In the crypto market, trading is not a one-time affair; this industry can be treated as a lifelong career. As long as we have the ability, we will not be affected by time, place, age, or environment.
Isn’t it really worth your effort, dedication, and continuous learning to master this ability?
If you believe, you can certainly achieve results. If you don’t believe, how can you talk about results?
Those who understand to lay out in advance can seize the opportunity for windfall; the next step of how to ignite it depends on whether you dare to get on the bus early!