After 10 years of trading cryptocurrencies, growing from a $30,000 capital to current assets worth millions, I've seen too many people rush in with dreams of 'getting rich overnight', only to end up with nothing left.

Let me speak frankly today: the cryptocurrency market can indeed change your destiny, but 90% of people lose due to 'trading with a gambler's mindset'. This article breaks down the pitfalls I've encountered and the logic behind the profits I've made, helping newcomers avoid at least 5 years of mistakes.

1. The 3 iron rules that can keep you alive are more important than any indicator.

  1. Capital management is not a multiple-choice question, it's a matter of survival.


    When I first entered the market, I suffered the most painful loss: I went all-in on an altcoin and got liquidated in 3 days, wasting half a year. Later, I realized a principle:The premise of making money in the cryptocurrency market is 'to survive long'..


    My approach is: divide the capital into 5 parts, only move 1 part at a time, never let a single position lose more than 10%, and if total funds lose 20% in a month, stop and review. Even if I make 5 consecutive mistakes, the remaining capital still gives you a chance to recover.


    I've seen too many people use a 'gambler's approach to adding positions': losing and then averaging down, getting deeper into losses until they have nothing left. Remember:Preserving capital is more important than catching 10 limit-up stocks..

  2. Picking up money in a trend can lead to life-threatening situations when going against it.


    In the bull market of 2021, I rode ETH from $1000 to $4000, not because I predicted it accurately, but because I understood 'trends are irreversible'. When the 30-day and 120-day moving averages turn upwards on the daily chart, even if there are pullbacks, the overall direction is still up; conversely, when the moving averages diverge downwards, any rebound is a trap.


    The most common mistake newcomers make: when prices drop, they shout 'buy the dip', and when prices rise, they fear 'missing out'. In fact, the market is like the tide; you can't stop it from rising nor can you prevent it from falling.Going with the flow allows you to pick up money, while going against it will only lead to being washed up on the shore..

  3. Technical indicators are tools, not commandments.


    I currently only use MACD and volume as indicators, but early on, I studied every indicator available, only to find:The more complex the indicator, the easier it is to deceive oneself..


    When the MACD crosses above the zero line with increased volume, that's a strong signal; a death cross below the zero line with sudden volume shrinkage likely indicates a drop. But remember: indicators are lagging; they tell you 'what happened in the past', not 'what will happen in the future'. True experts use indicators to validate trends, not to predict them.

2. The 3 biggest pitfalls retail investors easily fall into—avoid them to profit.

  1. Don't believe that 'holding long-term will make you rich.'


    Except for BTC, no cryptocurrency is worth holding for more than 3 years. In 2018, I held onto a altcoin that dropped from $10 to $0.1, believing the nonsense of 'diamond hands', and ultimately lost all my capital. I later understood:The cryptocurrency market is getting bigger, and junk coins will only go to zero, they won't make a comeback..


    My principle: only hold BTC and ETH for the long term, with a position not exceeding 50%; for other coins, run when they reach the target, never hold on too long.

  2. Leverage is an accelerator, not an ATM.


    I've seen people double their money in a day using 10x leverage, and I've also seen someone get liquidated for 30 million overnight due to 5x leverage. Leverage is like the gas pedal when driving; those who know how to use it can accelerate, while those who don't will only plunge off a cliff.


    Advice for newcomers: Don't touch leverage in the first two years, practice with spot trading; once familiar, use at most 5x leverage, with a position never exceeding 30%, and set a stop-loss at 8%—once triggered, cut the position immediately, don't wait for a 'rebound.'

  3. Don't chase hotspots, wait for opportunities.


    Every time a new hotspot emerges (like the recent AI coins, DeFi coins), retail investors always rush in, and the result is often being left holding the bag. I only do 'certain opportunities': for instance, if a coin is consolidating at a low for 3 months and suddenly breaks through a key resistance with volume, that's when I enter, the win rate is much higher than chasing after price increases.


    Remember:Opportunities in the cryptocurrency market are always there, but your capital is only available once.. It's better to miss 10 opportunities than to step into 1 pitfall.

3. How to choose between short-term and long-term?

Many people are torn between 'doing short-term or long-term', but it's like asking 'should I walk with my left leg or right leg'—the answer is 'alternate'.

  • In a bull market, long-term positions should account for 70%: choose BTC, ETH, and leading coins in their sectors (like ARB in Layer2), hold as long as the moving averages don't break down, and earn money from the trends.

  • In a bear market, short-term positions should account for 70%: focus on 15-minute and 1-hour candlestick charts, take profits of 3-5 points and run, accumulating small profits.

  • Regardless of bull or bear, always keep 30% cash: this is your 'emergency fund', allowing you to add to your position when the market shifts, and to increase your stake when opportunities arise.


I've seen the most powerful retail investors make 10%-15% monthly in bear markets through short-term trades, and 5 times in bull markets through long-term holds; this is the real 'walking on two legs'.


Lastly, I want to say: the cryptocurrency market can indeed change your fate, but it rewards not 'luck', but 'discipline'. Over the past 10 years, I've experienced liquidations and losses, but the reason I could stand up again wasn't because I made the right bet once, but because I repeatedly executed simple logic diligently.


If you are still losing money now, don't panic—stop first, clarify the logic above, and then enter the market. Follow me.#山寨季何时到来？ #比特币巨鲸动向