First, let's talk about capital management. Never invest all your money at once. I prefer to operate in batches, so even if I incur losses, it won't be too severe. I have set a rule for myself: once losses reach a certain extent, I decisively withdraw, regardless of the market conditions. This way, even if I incur several consecutive losses, it won't be too damaging, but if I make profits, the returns can be considerable. Even if I'm trapped, I can maintain my mindset.
Going with the market trend is definitely the right move. When the market is falling, don't always think about bottom fishing; it's unrealistic. When the market rises and corrects, that’s a good opportunity. Buying low at this time is much safer than stubbornly trying to catch the bottom.
Choosing coins requires insight; those coins that suddenly surge, whether mainstream or altcoins, must be approached with caution. Rapid increases often lead to equally rapid corrections, making it easy to get trapped.
On technical indicators, I often use MACD. When the DIF line and DEA line cross below the 0 axis and then break through the 0 axis, that is a buy signal. If they cross above the 0 axis and then move downward, I need to reduce my holdings. Don't easily attempt to average down. If you incur losses, don’t average down; many people end up losing more and ultimately losing everything. Remember, losses need to be cut, and profits can be added.
Trading volume is also crucial. When the price breaks through the lows with increased trading volume, it may be a significant opportunity.
The key is to go with the trend. Combine daily and monthly charts for comprehensive judgment; when a line bends upward, you know how to operate.
In conclusion, trading cryptocurrencies carries both risks and opportunities. I hope my experience can help everyone, but still, I must remind you to invest cautiously!
The basic principles of the Dow Theory applied to the actual situation in the crypto market can be summarized in the following six points:
First, the average price encompasses all factors. Fundamentals, policies, news, capital - all these can affect supply and demand relationships, and all of this will be directly reflected in the market, which ultimately digests and absorbs through price changes.
Second, the market has three kinds of trends. Dow divides trends into three categories: major trends, necessary trends, and temporary trends.
The main trend is like the tides of the ocean, belonging to a long-term trend, similar to the cyclical seasons of the cryptocurrency market, with bull and bear cycles being endless.
Minor trends are the waves in the tides, representing pullbacks in the major trend, usually retracing to the significant Fibonacci levels of 38%, 50%, and 62%. Short-term trends are ripples, referring to minor fluctuations, which have high uncertainty and change rapidly.
The third major trend can be divided into three stages. The first stage is the accumulation phase, similar to yin being followed by yang, indicating that the bear market has reached its end. Although everyone is bearish, the price has fallen to the lowest it can go, and at this time, the main force begins to accumulate in batches.
The second stage is the bull's attack phase, where favorable news starts to appear, and most retail investors with some technical knowledge gradually enter the market, leading to a gradual price increase.
The third stage is the climax sprint, during which major media begin to flood in with good news, boldly predicting continued price increases. Retail investors actively buy in, nobody wants to sell, all afraid of missing this once-in-a-lifetime opportunity to make money, but in reality, the main force that bought at the bottom has already started to offload.
Fourth, various average prices must mutually verify each other. For example, the joint increase of Bitcoin and mainstream coins must exceed the previous peak of the mid-trend to be called a large-scale bull market! Similarly, if the joint drop of Bitcoin and mainstream coins falls below the neckline position in the high-level fluctuation phase of the bull market.
Fifth, trading volume must validate the trend. Dow believes that volume holds the second position in technical analysis; when prices are advancing along a major trend, trading volume should also increase correspondingly.
Sixth, only after a clear and undeniable reversal signal occurs can we judge that an established trend has ended. A major trend has inertia and will generally continue to move in the main direction for a while, so we must wait for the trend to confirm the reversal, such as the head and shoulders pattern confirming a break below the neckline to be considered a trend reversal.
The Dow Theory is a macro technical analysis system aimed at capturing the segment with the largest amplitude in important market movements, that is, the most delicious part in the belly of the fish.
Its advantage lies in successfully determining major bullish and bearish trends, yet its drawback is also evident; signals are often delayed, typically missing out on 20%-25% of profit opportunities.
Share cryptocurrency trading insights:
1: Regularly invest in mainstream coins and leading coins. Regular investment has a higher probability of making money compared to going all in at once. If you invest your entire capital upfront and the price drops afterward, it becomes quite difficult to average down. Watching the lower prices makes it hard to hoard coins; it’s particularly frustrating to miss the opportunity to lower your cost, and even in a bull market, your returns will be much less.
2. Improve your ability to earn money outside the market.
In the market, the main thing is to buy coins and hoard them. If you want to hold onto coins, you need to improve your ability to make money outside the market. Your ability to make money depends on the work you do. If you have a lot of time, invest more in yourself, learn more things, acquire more skills, and follow me to become a Twitter KOL to turn traffic into cash.
3. Invest more in fields you are familiar with.
Investing more in areas you are familiar with allows for better risk control. Investing in things you do not understand could lead to greater losses. Investing in familiar areas increases cash flow, and with cash flow, you can gain more income, thus avoiding the need to sell valuable coins due to price drops.
4. Delve into the techniques of hot money trading.
Familiarize yourself with the historical trajectory of hundredfold coins. You need to establish your own profitable trading strategy and continuously optimize your coin selection and timing in practice.
Reveal small tricks for learning cryptocurrency trading:
1. Invest with spare money; avoid borrowing money to trade cryptocurrencies - invest money + invest effort.
2. Strictly filter valuable coins and create a reasonable funding allocation plan that aligns with reality - the sunny investment strategy.
3. Averaging down - it is normal to experience pullbacks after entering a position, so allocate funds reasonably and enter in batches.
4. Refuse to go all in, allocate positions reasonably, do not put all your eggs in one basket, effectively reduce risks.
5. Keep an eye on the surroundings - watch the latest news in the crypto market and financial sectors. The earlier you know, the earlier you understand, the earlier you can earn money.
6. Think reversely, do not confront market makers or trends, go with the flow and follow the trend.
7. Open contracts with no more than 5x leverage, do not easily use 100x leverage. It’s best to avoid leverage altogether. Don’t seek to get rich overnight; instead, aim for steady profits.
8. Control your income well - managing your positions is more important than anything else. If unsure, do not easily operate. If you don’t operate, there is no risk and thus no loss. Keep an eye on your assets, whether they are well managed, and whether the management is reasonable.
9. Keep the bottom and top in your mind, do not be afraid. The crypto market will only help you grow; your mindset is more important than operations. Remember the cryptocurrency trading methods, and you won’t worry about not making money!
Investing is not a competitive game but a personal journey of self-cultivation.
In fact, there is another saying: every penny you earn is the realization of your understanding of this world.
Spend an evening organizing 6 iron rules for trading cryptocurrencies. The content is not much, but it's full of practical insights. If you do not plan to leave the crypto world in the next three years, these 6 iron rules will assist you significantly!
As long as you can steadfastly practice these five major crypto rules, I firmly believe you will surpass over 90% of participants in the market.
In the world of digital currencies, adhering to these five major principles will help you steadily navigate the bull market, achieving stable wealth growth. Only by accurately capturing the pulse of the market and adhering to rational investment principles can you broaden your investment journey.
Can retail investors rely on 'contracts' to reverse their destiny in a bull market! Achieve the following points! The answer is: Yes!!!
Although you can trade spot, the real class leap for retail investors is through contracts!
Just don't recommend contracts for beginners.
So regarding whether one can rely on contracts to change their destiny. My answer is: Yes!
Use cycles + to trade contracts: the larger the cycle you look at, the higher your chances of winning. Essentially, the crypto market is a global financial market where you are playing a trading game with people from all over the world. Now you need to take money from their wallets. How to take it? Use slow money to earn fast money and use smart money to earn from the foolish.
Most people in this world are impatient, lack strategy, and act impulsively. Most people rely on a 'rush' to place orders, rarely paying attention to their positions, entry timing, and risk levels.
They focus only on how to make quick profits, thus entering and exiting quickly, betting big, and facing liquidation.
They trade for profits and losses of just a few dozen points, while you can extend your trades and aim for profits and losses of 200 points. This way, your chances of winning increase. Your capital will consume that kind of capital, and this is not due to your intelligence or patience.
Actually, you have utilized a very key factor - 'cycles.'
There are several short-term trading methods for cryptocurrency:
1. Technical analysis: Use chart analysis, trend analysis, and other technical indicators to determine price trends, including support and resistance levels, moving averages, etc., to find buying and selling opportunities.
2. News-driven: Pay attention to news and events in the market, analyze and predict their impact on the cryptocurrency market, and quickly buy or sell.
3. Intraday trading: Profit by capturing short-term price fluctuations, usually completing trades within a day.
4. Breakout trading: Assess market direction based on changes in trading volume when the price breaks through resistance or support levels, and buy or sell at the appropriate time.
5. Swing trading: Utilize the characteristics of significant price fluctuations to conduct medium to short-term buying and selling operations.
How to find your foothold in the futures market.
Operate with low leverage and low positions to maintain capital security and avoid liquidation risks;
Reduce trading frequency, avoid emotional trading, and make calm decisions;
Control emotions, avoid counter-trend operations, and face market fluctuations rationally;
Avoid small coins, operate steadily, and avoid losses from high risks.
Contract trading is not a game of quick wins but requires long-term patience and technical accumulation. Only by maintaining calm can you stand out in the ocean of the crypto market and gradually realize wealth appreciation. Remember, survive to have the opportunity to earn more profits.
A detailed article: The mindsets needed in the crypto market and a guide to avoid pitfalls.
People are not confused by the things themselves but by their views on those things - Ancient Greek philosopher.
A book states: 'Mediocre generals, when faced with complex environments, will list a pile of problems and questions for themselves, becoming flustered and lost. True generals cut through confusion with a sharp knife, discerning the essence and key points from seemingly ordinary situations, and act decisively.' This is similar to investment decisions; excellent investors are adept at grasping major contradictions in the market and companies, and can see the whole from the details to ultimately form decision-making 'logical fulcrums.'
What is mindset? Simply put, mindset is your attitude towards situations. An advanced version once said that mindset is actually just having a bigger heart.
The importance of mindset to a person is self-evident; mindset determines destiny. People with a good mindset often have better opportunities, are psychologically healthier, and tend to be happier; those with a bad mindset, due to internal grievances, often miss many opportunities.
The most important point when entering the crypto market is to control your mindset. Next comes technical analysis, fundamentals, and news. If your mindset collapses, you are destined not to make money, and your life and mental state will also be greatly affected. Most retail investors have fragile hearts; only a few can truly understand!
Exploring the world of digital currencies is like understanding the essence of life. Once you grasp the wisdom of living, the mysteries of the crypto world will also become clear. The path of simplicity is in the integration of knowledge and action, which allows you to navigate skillfully and securely!
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