Once you get the hang of trading cryptocurrencies, life is like having gained enlightenment! Ten years ago, when I first entered the crypto world, like most retail investors, my losses and profits seemed entirely based on luck, and I couldn't grasp the patterns. However, after spending a few years in the crypto world, through continuous learning and absorption, along with masters and senior brothers constantly sharing and guiding, I gradually got the hang of it and formed my own investment system!
After much thought, I decided to share my short-term trading mindset, which started with 50,000 and grew to 23 million in just three years! I wouldn't say I have become wealthy; just barely achieving financial freedom, I can only say that my expenses are covered. In this process, I deeply realize how important a good mentor is! Having been through the rain, I always want to hold an umbrella for others. Having experienced isolation and helplessness, I can empathize with others' losses. I want to extend a helping hand and make up for the regret of wanting to be pulled up at that time, like crossing time and space to hold an umbrella for my past self who was caught in the rain. This is also my original intention for sharing, hoping to help many friends in the crypto world avoid some detours!
If you manage it carefully, it will continue to grow and generate compound interest. In the crypto field, you also need to be careful to keep it from losing value; I will mention this later. The following ten pieces of advice are entirely based on my personal experience. Absolutely true, without any exaggeration.
1. Invest in hard assets early.
When I first bought gold, the price was about $1,600. Now this price has more than doubled. When I first bought Bitcoin, the unit price was about $700. And now the price has surpassed $100,000. These are all hard assets: they cannot be diluted or issued out of thin air. They have scarcity, high market demand, and are difficult to replicate.
Working or receiving a salary can never create wealth like investing in hard assets. Gold and Bitcoin both belong to the category of hard assets. Regardless, start using your spare money to dollar-cost average into hard assets.
This also includes purchasing index funds like the S&P 500 or real estate in consistently high-demand areas. Then let time work its magic; in 5, 10, or 20 years, you will reap surprises!
If you never invest in hard assets, it is almost impossible to become wealthy and accumulate wealth. When viewed from a long-term perspective over decades, even investing $1,000 today will bring huge changes. Do not procrastinate; make a plan and take action as soon as possible.
2. Do something that has growth potential.
This applies to any field; I have previously discussed similar viewpoints. Examine your current skills and what you love, imagining that 100,000 people can see the content you create. Even if only 1% of people recognize your value, it means you have 1,000 potential customers, fans, subscribers, or supporters.
Be bold and try. If you do not take the first step, you will never know the result, and it often brings surprises. Very few people dare to do this, but those who dare to try always gain something in return. Although it takes time to settle, one day you will achieve a breakthrough.
When I started, I had zero followers and no social foundation. So I began to work hard. I persisted in outputting daily, giving it my all, and people would naturally see your brilliance. Once you earn your first dollar online or obtain any income through entrepreneurship, the door to success will be completely opened.
Starting is the most challenging point, yet very few people put it into practice.
3. You can never be wealthier than your true self.
Your current level of wealth reflects the level of personal development you have achieved.
Therefore, if an ordinary person suddenly wins 1 million dollars in the lottery, he will almost certainly spend it all within a year. The reason is that his personal qualities far fall short of the ability required to manage that money.
Stop expecting others to act for you. If you do not invest in yourself, no one will help you invest. Knowledge is very accessible today; as long as you can access the internet, you can delve into any field. With artificial intelligence, you can also have a personal mentor to guide you at any time, provided you are willing to spend the time.
No excuses are necessary.
Refine your skills through practice (see point two). Even if your abilities are limited now, continuous practice will eventually lead to progress. Start taking action, and time will witness your transformation; this principle sounds akin to investing in Bitcoin.
4. Properly overestimate yourself.
Maintaining a positive feedback loop is crucial. When you evaluate your self-worth slightly above your current skill level, you will continue to pursue improvement.
Even if you have achieved nothing today, believe that you deserve to have more; you will ultimately accomplish something. Changing this mindset could have a significant impact on your future self.
What you do today shapes who you will be tomorrow.
5. Money is not everything.
Gold or Bitcoin can be purchased. However, you cannot buy a family on Amazon or find a place that can be called 'home.' These forms of wealth cannot be measured in money or sold anywhere.
On the road to pursuing material wealth, do not forget those truly important things.
Not establishing a family or cultivating meaningful relationships may come at a high cost in the future. Depression, midlife crises, or identity crises may follow, which is just as important as holding onto Bitcoin.
Material wealth is often meaningless if there is no one to share it with. After all, what humans cherish are various experiences, and more wealth allows people to have more experiences. However, some of the most profound experiences are actually nearly free.
6. Face challenges head-on.
If you are afraid to buy Bitcoin, that is likely a good sign that you should buy it. Fear often hinders you from trying new things. But if you want to enhance personal development (see point 3), exposure to new things is crucial.
These experiences can be painful, pleasant, or bland. If you stop labeling them and simply view them as new experiences of personal growth, you can quickly move to the next stage.
When you experience this cycle repeatedly, success and failure will meet again and again. The difference is: if you invest surplus energy into hard assets, every time you fall, you will fall from a higher point, and the climb will be faster. Success will come quicker, and the harvest will be more abundant.
7. Learn to reset yourself.
People are born here and have never left for decades; the environment has never changed. While this situation is still okay, you must be careful not to let the environment you are in limit your personal growth.
If you possess the mindset described in point 4 (i.e., placing more importance on self-worth), you will be able to keenly perceive this. As you continue to grow personally (see point 3), the things that bind you will naturally reveal themselves. At this point, you must make a choice, and this decision may trigger the psychological response (fear) described in point 6.
Breakthrough limits or give up and turn back? This may be your breakthrough to wealth.
8. Do not fall into traps that reduce wealth.
The typical representative of cryptocurrencies is altcoins. There is only one hard asset in the entire crypto world, yet it is filled with thousands of traps. Every time you spend money buying altcoins, the opportunity cost is failing to purchase Bitcoin.
This simple decision can cost you a huge amount of wealth over 5 to 10 years. The same principle applies whether you choose to buy a car instead of investing that money; any consumption comes at the expense of sacrificing investment opportunities.
Please view consumption and investment rationally, and beware of lifestyle inflation. If you have not used your income for investment, please correct this issue immediately.
After you have some wealth, reveal less, do not show off, and do not post on social media. Because doing so will attract people with ulterior motives. These people may also include relatives and friends who are preparing to sell you 'investment' projects.
9. Never sell your hard assets
A major taboo in cryptocurrency investing is exchanging Bitcoin for altcoins. Anyone who does this will ultimately pay a bloody price if they wait long enough. Although altcoins may occasionally outperform Bitcoin within a six-month to a year cycle, if you look further afield, over a span of several years, this has never happened.
The second issue with selling hard assets is that there are no better purchasing options. If you sell Bitcoin to buy gold, you are still holding hard assets, but the risk-reward characteristics differ.
Whatever you do, make sure you are not exchanging hard assets for inferior assets. If you decide to do so, be sure to calculate the risks and keep them to a minimum, ideally not exceeding 5% of your total wealth. The return for taking such risks must be asymmetric and should allow you to buy more Bitcoin later.
To accumulate wealth and retain it, you must hold onto hard assets tightly and never sell.
10. If you achieve success, be prepared to be targeted by others.
All success attracts wrongdoers, just as it does in the crypto field and in any other field. Last year, after downloading malicious software, I suffered a hacking attack that resulted in a loss of $50,000; my assets in the hot wallet were instantly cleared, and I even fell for such a simple scam.
I should have thought of this earlier, but I never stored large amounts of assets in hot wallets before the RAT Escape incident. Once the price of coins skyrockets, hackers will come. This is why, as long as you have any public exposure, you will inevitably become a target for attacks.
If you are currently at a loss and want to treat cryptocurrency trading as a second career in the future, please read this carefully; you will definitely gain something, and I recommend you save it!
In this article, I will explain a simple and practical trading strategy that combines two indicators. My article mainly focuses on trading strategies and uses technical indicators for trading. Many people also use other strategies related to price action.
The volume-weighted average price (VWAP) and the detrended price oscillator (DPO) are powerful tools in themselves. By combining them, you can create a strategy that utilizes trend following and focuses on mean reversion.
This strategy uses the volume-weighted average price (VWAP) for intraday trend guidance and utilizes the detrended price oscillator (DPO) to identify price deviations and reversals.
Before entering a strategy, let's first understand the indicators.
VWAP (Volume Weighted Average Price)
Helps determine the average price of securities based on quantity and price.
Aids in identifying intraday support and resistance levels.
Acts as a trend-following tool.
DPO (Detrended Price Oscillator)
Eliminate long-term trends and focus on short-term price cycles.
Identify overbought or oversold conditions.
01 How to add indicators in TradingView
1. Access TradingView
2. Open the chart
Navigate to the chart of the stocks, forex pairs, or cryptocurrencies you want to analyze.
3. Add volume-weighted average price
Click the indicators button at the top of the chart.
In the search bar, type VWAP.
Select the default VWAP indicator provided by TradingView.
After adding, VWAP will appear as a line overlay on your price chart.
4. Customize VWAP (optional)
To change color, line style, or visibility, hover over the VWAP line and click the gear icon.
Modify settings as needed and click 'OK.'
I changed the line to a black circle.
5. Add DPO
Click the 'Indicators' button again.
In the search bar, search for the Detrended Price Oscillator or DPO.
Select the default DPO indicator provided by TradingView.
DPO will appear in a separate window below the price chart.
02 Long conditions
A strong bullish green candle should cross above the VWAP.
A red candle should precede a bullish candle, and the red candle should be below the VWAP.
DPO transitions from the negative zone to the positive zone and breaks through the zero line.
Confirm through bullish candlestick patterns or increased volume at the breakout.
03 Short selling conditions
Strong bearish red candles must close below the VWAP.
A bearish red candle should be preceded by a green candle above the VWAP line.
The Detrended Price Oscillator (DPO) should move from the positive zone to the negative zone and cross the zero line.
To achieve stronger momentum, the DPO should also break below -500.
Look for increased volume during pullbacks as additional confirmation of the trend.
Alternatively, use bearish candlestick patterns (such as bearish engulfing or evening star) to confirm entry points.
04 Take profit / Stop loss
Exit strategies are just as important as entry conditions.
It is crucial to establish clear rules to lock in profits and minimize losses.
1. Long exit: If the price falls below the VWAP, it indicates that the trend may reverse, or if the DPO reaches a peak and begins to move back towards the zero line, it indicates that bullish momentum is weakening, then exit the trade.
2. Short distance exit: For short selling, exit when the price rises above VWAP, or when the DPO falls back to zero after dropping into negative territory, indicating that selling pressure may have ended.
05 Final thoughts
Combining the volume-weighted average price (VWAP) and the volume spread (DPO) is an effective strategy that helps traders follow market trends while capturing price deviations to gain opportunities for mean reversion.
By following clear entry and exit rules, using volume as confirmation, and implementing robust risk management measures, traders can improve decision-making and enhance overall trading performance.
The above is a summary of my over ten years of practical experience and techniques in trading cryptocurrencies. It may not be suitable for everyone and requires each person to combine their own practice with the summary. As a trader, the scariest thing is not that you have technical problems, but that your understanding is insufficient, and you fall into these trading traps without realizing it! There is no invincible trading system, only invincible users of trading systems! This is the truth; trading systems ultimately return to the individual!
No matter how diligent a fisherman is, he won't go out to fish in the stormy season but will instead carefully protect his fishing boat; this season will eventually pass, and a sunny day will always come! Focus on the banquet and learn both how to fish and how to fish for fish. The door to the cryptocurrency world is always open. Only by going with the flow can one have a life that flows with the current; keep it collected and remember it in your heart!
