Insights from these days in the crypto space! Given to friends who are new to the circle.
1. Do not be attached to hot coins; altcoins should be exchanged for profit at a certain point. Trying to hold from start to finish is inevitably a futile endeavor. The reasoning is simple: altcoins cannot keep rising indefinitely. Once they have been traded, they should be exchanged; otherwise, if they drop back to the original point, it will all be in vain, like FIL or LUNA from back in the day.
2. After a period of consolidation at a high level, be ready to sell when the opportunity arises; after a period of consolidation at a low level with new lows, there is a high probability of a good opportunity. When the coin price consolidates at a high level and then creates a new high, be wary of the main force inducing buying; do not hesitate to reduce your position or exit. Conversely, when the coin price consolidates at a low level and then creates a new low but quickly recovers, it is likely the main force is washing out the last holders; at this time, one should remain steadfast.
3. When the market environment is poor, the coin price may rise against the trend, and a small rise against the trend may lead to a large rise. When the market environment is good, the coin price may fall slightly against the trend, and a small fall against the trend may lead to a large drop.
4. Only increase when making money, do not average down when losing; this may break many people's understanding. We should increase our position when the coin price breaks through the previous high, rather than adding to our position when it is continuously falling. Otherwise, we will just add more and lose more, ultimately becoming unable to move. We must cut losses and let profits run.
5. Once you identify the bottom price, there is generally a two up, one down increase. At this time, do not doubt it; generally, a big surprise follows. Especially during trend increases, the price rises while also washing out positions; do not easily exit.
6. Top players first look at sectors, second-tier players only look at single coins, third-tier players look at indicators, and bottom-tier players just gamble. This means that when we want to buy a certain coin, we should first look at the sector. Only by focusing on hot sectors can we have high popularity and high winning rates. Next, look at the tokens; only looking at indicators means you are a novice, while looking at everything is just gambling.
7. Indicators change with volume and price, so volume and price are the root of indicators. If you don't look at volume and price, you are blindly following indicators. All indicators are calculated based on coin prices and trading volumes, so true technical analysis requires looking at volume and price; price increases need substantial capital support.
8. In an upward trend, look for support; in a downward trend, look for resistance. When the coin price is on an upward trend, operating based on support lines has a high success rate and provides opportunities for low buys. In a downward trend, operating based on resistance lines also has a high success rate, providing opportunities to short or exit.