At 3 AM, I was slumped on the sofa in my rental apartment, the light from my phone screen stinging my eyes—my account balance went from 50,000 to 370,000 and then back to 120,000. This was a number I couldn't save even after two years of delivering food, yet it evaporated in half an hour. As my finger hovered over the 'liquidate' button, I suddenly realized: ordinary people wanting to turn their fortunes around through cryptocurrency trading is not about gambling with their lives, but about transforming themselves into a 'humanity harvesting machine.'
This is a real story from a fan of Mr. Zhuang in the cryptocurrency market. In 2019, he was a delivery worker overwhelmed by online loans, and he happened to see news about Bitcoin breaking 10,000 dollars in an internet cafe. With 8,000 yuan cashed out from Huabei, he entered the cryptocurrency market, experiencing: the Black Swan of March 12: the principal dropped to only 1,800 yuan, but he used the 'buy the dip' strategy to recover within half a year. The animal coin craze: buying SHIB+ at 0.000007 dollars, holding through a 90% drop without selling, ultimately increasing by 182 times. Contract liquidation: shorting Luna+ with 20x leverage, losing 230,000 yuan in 15 minutes, but thus realizing the 'anti-human nature operation' iron law.
"When I was at my poorest, I couldn't even afford instant noodles, but now I own two houses in Shanghai, all paid for. "He opened the exchange app, pointing to the trading record from May 2021, saying: "I made 800,000 on this ETH* trade; the secret is just one phrase—when everyone shouts 'get on board quickly,' you have to learn to quietly fasten your seatbelt."
My answer is yes, definitely! The madman himself is a beneficiary in the cryptocurrency market, which is a place not lacking in dreams. In early 2014, I unexpectedly encountered cryptocurrency, initially playing with over 10,000 yuan, experiencing liquidations and debts! Since I started trading, I have gone through ups and downs, just like everyone else, experiencing pain as well as joy. However, the most gratifying thing is that I did not give up and insisted on starting full-time trading, embarking on a path to live off trading.
Beginners often crave quick ways to accumulate wealth. Today, the madman presents 10 proven rules for making money easily. Master this foolproof cryptocurrency trading formula to help your assets achieve exponential growth; it is recommended to collect and study repeatedly.
Bottom-fishing rule: When a strong cryptocurrency continuously declines for 9 days at a high position, this is very likely to be an excellent bottom-fishing signal. At this time, do not hesitate; act decisively. This continuous decline often reveals a true investment opportunity, often referred to as a golden pit. In the cryptocurrency market, significant corrections sometimes present good opportunities to acquire low-priced assets; seizing such opportunities lays the foundation for future wealth growth.
Take profit rule: If the cryptocurrency you hold has risen for two consecutive days, you must consider reducing your position to lock in profits. The market is unpredictable, and there is no myth of prices only going up without falling. Timely securing the profits you have earned is the most practical approach. Avoid missing the best take profit opportunity due to greed, leading to profit erosion.
Rally signal: When a cryptocurrency shows a 7% rise, this is merely the beginning of the market trend. Typically, the next day, the cryptocurrency will continue to rise due to inertia. Therefore, investors should closely monitor the market and avoid being too hasty to exit. Patiently waiting for the price to rise further can yield greater profits.
Trend password: For those cryptocurrencies with long-term upward potential, the end of a pullback is the best entry point. In cryptocurrency investments, it is essential to refuse the behavior of blindly chasing highs and selling lows. Patiently waiting for the market to pull back to an appropriate level and entering in line with the trend is like waiting for the wind to come, allowing you to easily ride the wave of wealth growth.
Market change alert: If the cryptocurrency price has been range-bound for three days, further observation is required. If the range persists for six days without a breakout, investors should decisively choose to switch positions and avoid being attached. A prolonged range that cannot break through often indicates that the market may soon undergo a change; timely adjusting investment direction can effectively avoid risks.
Stop loss iron law: If, after buying a cryptocurrency, the next day you do not recover the cost, you should immediately liquidate and exit. In cryptocurrency investments, stop losses must be decisive; once you realize the investment direction is wrong, quickly cut your losses. Hesitation often leads to greater losses; strictly executing the stop loss strategy is essential to maintain strength in the market.
Consecutive rise law: When a cryptocurrency rises for three consecutive days, it often indicates that a five-day rising trend may follow. On the fifth day, investors should take profits. In the cryptocurrency market, knowing when to sell is key to investment success. Accurately grasping the selling opportunity can maximize profits.
Volume-price Bible: When a cryptocurrency breaks out at a low position with increased volume, this is a clear entry signal. The expansion of trading volume indicates active market participation, and prices are expected to continue rising. Conversely, if there is a volume stagnation at a high position, it is a strong warning to exit.
Moving average strategy: In technical analysis, the 3-day line can be used to determine short-term trends, the 30-day line assists in observing medium-term trends, the 80-day line is often related to major upward trends, and the 120-day line can serve as a reference for long-term investments. Investors should choose cryptocurrencies with upward trends in moving averages for investment, follow the trend to operate, which can achieve stable profits and avoid fatigue and risks caused by frequent operations.
Comback strategy: Even with a small amount of capital, considerable returns can be achieved in the cryptocurrency market. The key is to refuse the interference of FOMO (fear of missing out) emotions and strictly adhere to trading discipline. Persistently learning and practicing every day allows you to improve your investment knowledge and skills by 1%, creating a miracle of wealth growth through the power of compounding.
Without further ado, let’s get straight to the point!
Before discussing this trading strategy, we need to understand some basic knowledge about the Bollinger Bands indicator. Bollinger Bands was developed in the 1980s by John Bollinger as a market trend technical indicator used to measure market volatility and price movement.
Bollinger Bands consist of three lines: upper, middle, and lower. The middle line primarily measures the medium-term trend and is typically a simple moving average, serving as the basis for the upper and lower bands.
Today, Bollinger Bands are a standard tool on the MetaTrader 4 trading platform, primarily used to measure volatility and predict whether a current trend is about to reverse.
Bollinger Band middle line forex trading strategy+ as shown on the daily chart of EUR/USD with Bollinger Bands indicator:
In this issue's trading strategy, we mainly discuss a trading system using the middle Bollinger Band line for forex trading. When a single candlestick (or when the candlestick closes) touches the middle Bollinger Band line, you can enter the trade. The trading method is as follows: (1) When the Bollinger Bands open upwards or slope upwards, you can look for buying opportunities; (2) When the Bollinger Bands open downwards or slope downwards, you can look for shorting opportunities; (3) Note! You need to use the middle Bollinger Band line to determine whether to go long or short, not the upper and lower Bollinger Bands. #The Bollinger Bands parameters are set as described above, consisting of three directional lines, with the middle line being a 20-day simple moving average (SMA*). The lower band is the middle line minus two standard deviations, and the upper band is the middle line plus two standard deviations.
Bollinger Band middle line trading details and rules.
When in an upward trend, the Bollinger Band lines will show an upward trend; thus, you need to wait for the price to retrace and touch the middle Bollinger Band line. When the price rises and touches the middle Bollinger Band line, you can enter a long position immediately (as long as it touches the middle line) or wait for a single candlestick (K-line) to close touching the middle Bollinger Band line to enter a long position.
Where to set stop loss for long positions?
If your long position enters near the middle Bollinger Band line, the best stop loss position should be at least 5-15 points below the lower position of the Bollinger Band line or the low of the entry candlestick.
If your long position is entered after the price touches the middle Bollinger Band line at the candlestick closing, then the best stop loss position should be at least 5-10 points below the low of the entry candlestick.
Short entry rules
The Bollinger Bands must be sloping downwards.
Wait for the price to rise and touch the middle Bollinger Band line, and immediately enter the trade:
Or short after the candlestick touches the middle Bollinger Band line and closes.
Where to set the stop loss for short positions?
Set the stop loss at the same level as the upper Bollinger Band line:
Alternatively, set your stop loss 5-15 points above the high of the entry candlestick:
Where to set take profit?
If it is a long position trade, you can take profit and exit when the candlestick touches the upper Bollinger Band line:
If it is a long position trade, you can take profit and exit when the candlestick touches the lower Bollinger Band line, or you can use a trailing stop loss, moving the stop loss to the high point of each candlestick (for short positions, move the stop loss to the low point of each candlestick), until your order locks in expected profits and is stopped out.
Key points of the Bollinger Bands middle line trading strategy.
This strategy is a very simple trading strategy for beginners in forex trading:
If you are a forex scalper and prefer to trade in smaller time frames, then this strategy can be used for scalping, and you can trade in 1-5 minute chart cycles.
Bollinger Bands middle line trading strategy can also be used on 4-hour or daily charts.
Try not to trade when the Bollinger Bands are frequently narrowing or tightening, as this may lead to a large number of false trading signals.
Consider using reversal candlestick patterns for trade entry confirmation:
A good trading market will provide you with good profit opportunities.
Bollinger Bands combined with dynamic support and resistance forex trading strategy.
Bollinger Bands have advantages of flexibility, intuitiveness, and trend-following, which have made it a hot indicator for traders. Among various technical indicators, Bollinger Bands have their unique performance and application. Today, we will introduce a trading strategy that combines Bollinger Bands with dynamic support and resistance; it is a trading strategy that is easy to understand and implement. It is based on the dynamic support and resistance formed by the Bollinger Bands.
Dynamic support refers to the price falling and touching the lower Bollinger Band line, then rebounding upwards. Thus, the lower Bollinger Band line provides dynamic support for the price.
Conversely, for dynamic resistance, when the price rises and touches the upper Bollinger Band line and then retraces.
The following diagram shows an example of dynamic support and resistance at the upper and lower Bollinger Bands. Note how the price touches the bands and rebounds/retraces.
Time frame: Try applying this strategy on 1-hour and 4-hour charts.
Currency Pair: Any
Forex indicator: Bollinger Bands with default parameter values.
Trading rules for long position settings
Wait for the price to touch the lower Bollinger Band line:
After the candlestick closes at the lower Bollinger Band line, you can set a buy stop order 2-3 points above the high point of the candlestick and set a stop loss at least 5 points below the low point of the candlestick.
In terms of take profit, you can set it near the middle or upper Bollinger Band line.
Setting for short positions
Wait for the price to rise to the upper Bollinger Band line:
You can set a sell stop order 2-3 points below the lowest point of the candlestick and set a stop loss at least 5 points above the high point of the candlestick that touches the upper Bollinger Band line after it closes.
You can set a take profit at the middle or lower Bollinger Band line.
It is worth noting that if your trading order has not been activated by the next candlestick, you can adjust the order until it is activated. Additionally, a better entry method is to enter when the candlestick touching the Bollinger Band line forms a reversal candlestick pattern, which has a higher probability of successful trading. "Waiting is actually trading; patiently wait for the market to confirm your judgment. Before the market itself confirms your analysis, do not fully trust your judgment.
Time frame: Try applying this strategy on 1-hour and 4-hour charts.
Currency Pair: Any
Forex indicator: Bollinger Bands with default parameter values.
Trading rules for long position settings
Wait for the price to touch the lower Bollinger Band line.
You can set a buy stop order 2-3 points above the high point of the candlestick, and set a stop loss at least 5 points below the low point of the candlestick that touches the lower Bollinger Band line after it closes.
In terms of take profit, you can set it near the middle or upper Bollinger Band line.
Setting for short positions
Wait for the price to rise to the upper Bollinger Band line:
After the candlestick closes at the upper Bollinger Band line, you can set a sell stop order 2-3 points below the lowest point of the candlestick and set a stop loss at least 5 points above the highest point of the candlestick.
You can set a take profit at the middle or lower Bollinger Band line.
It is worth noting that if your trading order has not been activated by the next candlestick, you can adjust the order until it is activated. Additionally, a better entry method is to enter when the candlestick touching the Bollinger Band line forms a reversal candlestick pattern, which has a higher probability of successful trading. "Waiting is actually trading; patiently wait for the market to confirm your judgment. Before the market itself confirms your analysis, do not fully trust your judgment.
Additionally, I would like to share a few practical experiences I summarized over ten years of trading and three years of losses:
1. As long as a strong cryptocurrency has declined for nine consecutive days at a high position, be sure to follow up promptly.
2. If any cryptocurrency has risen for two consecutive days, be sure to reduce your position promptly.
3. If any cryptocurrency has risen more than 7%, there is still a chance for further increases the next day, so keep observing.
4. Strong cryptocurrencies must wait for the end of the pullback before entering.
5. If any cryptocurrency has been flat for three consecutive days, observe for another three days. If there is no change, consider switching.
6. If any cryptocurrency fails to recover the previous day's cost price the next day, exit promptly.
7. In the rise ranking, if there are three, there must be five; if there are five, there must be seven. Cryptocurrencies that have risen for two consecutive days should be bought on dips, as the fifth day is usually a good selling point.
8. Volume-price indicators are crucial; trading volume is the soul of the cryptocurrency market. When the price breaks out from a low consolidation with increased volume, it should be noted; conversely, if there is a volume stagnation at a high position, decisively exit.
9. Only choose cryptocurrencies that are in an upward trend for operation, as this maximizes your chances and prevents wasting time. When the 3-day line is turning upwards, it belongs to the short-term rise; when the 30-day line is turning upwards, it indicates a medium-term rise; the 80-day line turning upwards signifies a major upward trend; the 120-day moving average turning upwards indicates a long-term rise.
10. In the cryptocurrency market, small capital does not mean no opportunities. As long as you master the correct methods, maintain a rational mindset, strictly execute strategies, and patiently wait for opportunities to come.
The above is the trading experience shared by Yuhui today. Many times, you lose a lot of money-making opportunities due to your doubts. If you don't dare to try, touch, or understand, how will you know the pros and cons? You will only know how to proceed after taking the first step. A cup of warm tea, a piece of advice, I am both a teacher and a good conversational friend.
Meeting is fate, knowing each other is a bond. The madman firmly believes that fate leads to meeting, and lack of fate leads to parting. The journey of investment is long, and immediate gains and losses are just the tip of the iceberg. One must know that even the wisest can make mistakes, and the foolish can sometimes gain. Regardless of emotions, time will not stop for you. Pick up the burdens in your heart, stand up again, and prepare to move forward.
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