#以太坊十周年 #币安HODLer空投TREE #ETH重返3800 Ten years of deep cultivation in the cryptocurrency world, experiencing ups and downs; starting with 500,000 and reaching over 7 million at the peak; at that moment, I thought I was a trading genius, focusing solely on cryptocurrency trading, even borrowing money to trade. However, reality taught me a lesson, as I encountered continuous problems, not only losing all profits but also accumulating debts, ultimately having to sell my car and house. 2017 was my darkest hour, falling from the peak to the trough in just a few months.
Later, I summarized and reflected, and was fortunate to chat with several big names in the cryptocurrency space over tea. Their words left a deep impression on me and resonated with my soul.
Later, I began to summarize methods, continuously reviewing and reshaping my trading methods, utilizing the Dreamer tool to create my own trading strategies, changing my mindset, and continuously learning and updating. Although I can't say I've reached the pinnacle of life, I have achieved stable profits and can steadily outperform over 80% of people. Looking back at the whole process, it has been full of twists and turns.
From an initial investment of 500,000, I caught the bull market and made a fortune of ten million; then from ten million to my current small target. This year, I am waiting for and preparing for the next bull market, aiming to reach three small targets.
Now my monthly income is in seven figures, and the core secret of my eight-figure annual income is: (Japanese candlestick chart) 8 major candlestick patterns that easily capture market trends, with a win rate of up to 100%. It is simple, easy to understand, and suitable for everyone!
What is a candlestick?
Candlesticks are a charting technique used to describe asset price movements. They were first developed in Japan in the 18th century and have been used for centuries to identify patterns that may indicate the future direction of asset prices. Today, cryptocurrency traders use candlesticks to analyze historical price data and predict future price trends.
A single candlestick forming a candlestick pattern can indicate whether prices are likely to rise, fall, or remain unchanged. This provides insights into market sentiment and potential trading opportunities.
What is a candlestick chart?
Imagine you are tracking the price of an asset such as stocks or cryptocurrencies over a period (e.g., a week, a day, or an hour). A candlestick chart is a visual representation of this price data.
A candlestick has a body and two lines, usually referred to as wicks or shadows. The body of the candlestick represents the range between the opening and closing prices during that time period, while the wicks or shadows represent the highest and lowest prices achieved during that time.
A green body indicates that the price increased during this period. Conversely, a red body indicates a bearish candlestick, showing that the price decreased during this period.
Read candlestick patterns in four steps!
To fully understand all the candlestick patterns we will showcase in this article, you must understand the basics of candlesticks!
Japanese candlesticks consist of the following components:
In the diagram below, we can see two examples of candlesticks. The 'body' includes the difference between the opening and closing prices, while the lines on either side (called wicks or shadows) represent the highest and lowest prices during that time period.
A closing price higher than the opening price will generate a blue (bullish) candle.
If the closing price is lower than the opening price, a red (bearish) candlestick will form.
Candlestick charts provide us with four important pieces of information: ?
Opening price: after the previous candlestick ends, a new candlestick begins to form, starting at the closing level of the previous candlestick. There may be exceptions if there is a market gap.
Closing Price: If bullish, this is the highest point of the candlestick body. If bearish, it will be the lowest point of the body. Normally, the next candlestick starts from this level.
Highest Price: This is the highest level reached during the discussed time interval. The price fluctuates and reaches its maximum at the end of the wick. When the closing price is at a high, it becomes less apparent.
Lowest Price: This is the lowest level reached during the discussed time interval. The price fluctuates, marking the market's low point. When the closing price is at the bottom of the candlestick, it becomes less apparent.
Bullish Candlestick Patterns
Hammer
The hammer is a candlestick with a long lower wick at the bottom of a downtrend, where the lower wick is at least twice the size of the body.
The hammer shows that despite significant selling pressure, the bulls managed to push the price up near the opening. A hammer can be red or green, but a green hammer may indicate a stronger bullish reaction.
Inverted Hammer
This pattern resembles a hammer, but has a long wick above the body rather than below. Similar to the hammer, the upper wick should be at least twice the size of the body.
The inverted hammer appears at the bottom of a downtrend and may indicate upward potential. The upper wick indicates that the price has stopped declining, although sellers ultimately managed to push it down near the opening. Therefore, the inverted hammer may indicate that buyers may soon take control of the market.
Three White Soldiers
The Three White Soldiers pattern consists of three consecutive green candlesticks that open within the body of the previous candlestick and close above the high of the previous candlestick.
These candlesticks should not have long lower wicks, indicating that sustained buying pressure is driving the price higher. The size of the candlestick and the length of the wicks can be interpreted as opportunities for continuation or possible retracement.
Bullish Harami
A bullish harami is a long red candlestick, followed by a smaller green candlestick, completely contained within the body of the previous candlestick.
A bullish harami can form over two days or longer, indicating that the selling momentum is slowing down and may soon come to an end.
Bearish Candlestick Patterns
Hanging Man
A hanging man is the bearish counterpart of the hammer. It typically forms at the end of an uptrend, characterized by a small body and a long lower wick.
A lower wick indicates significant selling pressure, but the bulls managed to regain control and push the price up. In light of this, a sell-off after a long uptrend can serve as a warning that the bulls may soon lose momentum in the market.
Shooting Star
A shooting star consists of a candlestick with a long upper wick, a small body, and little to no lower wick, ideally close to the bottom. The shape of the shooting star resembles an inverted hammer but forms at the end of an uptrend.
This indicates that the market has reached a peak, but sellers then took control of the price and pushed it back down. Some traders prefer to wait for the next few candlesticks to unfold to confirm the pattern.
Three Black Crows
Three Black Crows consist of three consecutive red candlesticks that open within the body of the previous candlestick and close below the low of the last candlestick.
Bearish is equivalent to Three White Soldiers. Ideally, these candlesticks should not have longer wicks, indicating that selling pressure continues to push prices lower. The size of the candlestick and the length of the wicks can be used to judge opportunities for continuation.
Bearish Harami
A bearish harami is a long green candlestick followed by a small red candlestick, whose body is completely contained within the body of the previous candlestick.
The bearish harami can unfold over two days or longer, appearing at the end of an uptrend, and may indicate that buying pressure is weakening.
Dark Cloud Cover
The dark cloud cover pattern consists of a red candlestick that opens above the closing price of the previous green candlestick but then closes below the midpoint of that candlestick.
High trading volume typically accompanies this pattern, indicating that momentum may shift from bullish to bearish. Traders may wait for a third red candlestick to confirm the pattern.
Three Continuation Candlestick Patterns
Three Methods of Ascending
The ascending three methods candlestick pattern occurs in an uptrend, where three consecutive red candlesticks with small bodies follow a continuation of the upward trend. Ideally, the red candlesticks should not break through the area of the previous candlestick.
Continuation confirmed by a large green candlestick, indicating that bulls have regained control of the trend's direction.
Three methods of falling
The reversal of three methods of ascension indicates the continuation of a downward trend.
Doji
When the opening and closing are the same (or very close), a doji is formed. The price may be higher and lower than the opening price but ultimately closes at or near the opening price. Therefore, a doji can indicate a point of indecision between buying and selling forces. However, interpretations of dojis are highly context-dependent.
Based on the positions of the opening and closing lines, a doji can be described as follows:
Gravestone Doji
This is a bearish reversal candlestick with a long upper wick, with the opening and closing prices close to the low of a long-legged doji.
Indecisive candlestick with upper and lower wicks, opening and closing near the midpoint.
Dragonfly Doji
Bullish or bearish candlesticks, depending on the context, feature long lower wicks and opening/closing prices near the high.
According to the original definition of the doji, the opening and closing should be the same. But what if they are different but very close? That is called a spinning top. However, due to the extreme volatility of the cryptocurrency market, there are rarely exact dojis. Therefore, spinning tops are often used interchangeably with dojis.
8 Most Popular Candlestick Patterns!
The most famous candlestick patterns in forex trading are:
✔️ Marubozu Candle
✔️ Hammer Candle
✔️ Shooting Star Candle
✔️ Hanging Man Candlestick
✔️ The Piercing Line
✔️ Dark Cloud Cover
✔️ Engulfing Candles
✔️ The Master Candle
Of course, there are many other candlestick patterns, but in this article, we will focus on the most popular patterns.
?️ Marubozu Candle
A Marubozu candle is a strong momentum candlestick pattern that typically appears at support or resistance levels. A Marubozu candle has no wicks or very small wicks on either side, indicating significant selling resistance or strong buying support.
⤴️ Bullish Marubozu Candle
A bullish Marubozu candle appearing in an uptrend may indicate the continuation of the current trend, while in a downtrend, it may indicate a potential bullish reversal.
This is an example of a bullish Marubozu candle:
⤵️ Bearish Marubozu Candlestick
Conversely, a bearish Marubozu candlestick appearing in a downtrend may indicate its continuation, while in an uptrend, a bearish Marubozu candlestick may indicate a potential bearish reversal pattern.
Here are some examples of bearish Marubozu candlesticks:
Hammer Candle
The lower shadow of a hammer candlestick is longer, usually at least twice the length of the body, which is relatively short. It is a bullish reversal candlestick pattern appearing at the bottom of a downtrend.
The hammer candlestick pattern tells us that despite significant selling pressure during the session, buyers ultimately controlled the price and forced it to rise.
A hammer candlestick body can be bullish or bearish, but if it is bullish, it is considered a stronger signal.
Shooting Star
The shooting star candle appears in an uptrend, marking a potential reversal. Visually, it is essentially the opposite of the hammer candlestick, featuring a long upper wick and a short body.
The shooting star candle can be either bullish or bearish, but if it is bearish, it is considered stronger.
Hanging Man Candlestick
The hanging man candlestick looks similar to the hammer candlestick, except that it occurs at the top of an uptrend, marking a potential bearish reversal.
Like the hammer, the hanging man candlestick pattern indicates that selling pressure was present during trading but was ultimately overcome by buyers, successfully pushing the price up.
However, in an uptrend, this candlestick pattern is often seen as a sign that buyers are beginning to lose control over the market, indicating that a reversal may be imminent.
Piercing Line Candlestick
The piercing line is a bullish reversal candlestick pattern, and like the other candlestick patterns studied in this article, it often appears frequently in the market.
A bullish candlestick pattern confirmed when it follows a bearish candlestick. The second bullish candlestick must close above the midpoint of the first bearish candlestick's body.
Typically, the opening price of a bullish candlestick is also lower than the closing price of a bearish candlestick; however, in the forex market, if the opening price of the second candlestick is equal to the closing price of the first candlestick, the pattern is still valid—even if it is not seen as strong.
Dark Cloud Cover Candlestick
The dark cloud cover candle is a bearish reversal pattern appearing in an uptrend, essentially the opposite of the piercing line candlestick.
This pattern consists of two candlesticks, one bullish followed by one bearish. The opening price of the second candlestick is higher than the closing price of the first candlestick but then drops and closes below the midpoint of the first candlestick's body.
Like the piercing line, in the market, the dark cloud cover candlestick is considered valid even if the second candlestick opens at the close of the first candlestick.
However, it is important that the closing price of the second candlestick in this pattern should be below the 50% mark of the first candlestick's body.
Engulfing Candle
Bullish and bearish engulfing candlestick patterns consist of two candles, indicating a potential reversal. Bullish engulfing candles typically appear at the bottom of a downtrend, while bearish engulfing candles appear at the top of an uptrend.
⤴️ Bullish Engulfing Candle
The bullish engulfing candle is characterized by two candles, the first of which is bearish and contained within the body of the second candle, which is always bullish.
This is an example of a bullish engulfing candlestick pattern:
Bearish Engulfing Candle
A bearish engulfing candle also features two candlesticks. The first is bullish, contained within the body of the second candlestick, which is always bearish.
This is an example of a bearish engulfing candlestick pattern:
Master Candle
The master candle is one of the candlestick patterns well known by many price action traders. The master candle is defined by 30-150 point candlesticks, engulfing the next four candlesticks.
The breakout of the main candlestick is only valid if the 5th, 6th, or 7th candlestick breaks the range, allowing for trading.
This is a candlestick pattern that you can regularly check while trading. In the next section, we will provide an example illustrating how the candlestick pattern strategy works in trading.
How to use candlestick patterns in cryptocurrency trading:
Traders should keep the following tips in mind to effectively use candlestick patterns when trading cryptocurrencies:
1. Understand the basics.
Cryptocurrency traders should have a deep understanding of the basics of candlestick patterns before making trading decisions based on candlestick patterns. This includes knowing how to read candlestick charts and the various patterns that can form.
2. Combine various indicators.
While candlestick patterns can provide valuable insights, they should be used alongside other technical indicators to form a more comprehensive forecast. Some examples of indicators that can be combined with candlestick patterns include moving averages, RSI, and MACD.
3. Use multiple time frames.
Cryptocurrency traders should analyze candlestick patterns across multiple time frames for a broader understanding of market sentiment. For example, if a trader is analyzing a daily chart, they should also look at hourly and 15-minute charts to understand how these patterns perform across different time frames.
4. Practice risk management.
Like any trading strategy, using candlestick patterns carries risks. Traders should always practice risk management techniques, such as setting stop-loss orders, to protect their capital. It is also important to avoid overtrading and only trade at favorable risk-reward ratios.
Conclusion
Every trader can benefit from familiarizing themselves with candlesticks and what their patterns indicate, even if they do not incorporate them into their trading strategies.
While they are useful in market analysis, it is important to remember that they are not infallible. They are useful indicators that convey the buying and selling forces that ultimately drive the market.
Advice for cryptocurrency traders: take a minute to look at this! 8 things to note after achieving financial freedom in the cryptocurrency world.
On the road to financial freedom, many have chosen the cryptocurrency space as their springboard.
However, the road after success is not always smooth for everyone.
Here are 8 things to avoid after achieving financial freedom in the cryptocurrency world, helping you better enjoy life after success without being troubled by its side effects.
1. Protect personal privacy
First, after achieving success, learning to protect your privacy is crucial.
There is no need to showcase your success or profits to the outside world, nor should you excessively flaunt on social media.
By doing so, you can avoid unnecessary attention and ensure your safety.
2. Choose Your Circle
Not everyone can understand the risks and rewards of the cryptocurrency world.
Therefore, after achieving financial freedom, be cautious in choosing the people you want to engage deeply with.
Sometimes, maintaining a certain distance from those who cannot comprehend your path is a way to protect your wealth and mood.
3. Stay away from high-risk choices.
Gambling and drugs are destructive choices, both for wealth and for health.
After achieving success, one must be soberly aware of this and resolutely stay away from things that can destroy all your efforts.
4. Maintain a calm mindset.
Be kind to others, stay calm, and avoid unnecessary disputes.
Stay calm in unnecessary conflicts, investing time and energy in more valuable things.
5. Helping others and self-care.
While it is said that one should not overly obsess over helping others, moderate acts of kindness and concern for others can enrich and give meaning to your path to success.
At the same time, respect the choices and lives of others.
6. Prudent investment.
After achieving success, do not easily venture into investment areas you do not understand.
Remember, knowledge is power, especially in investing.
7. Be cautious in entrepreneurship
If you want to venture into entrepreneurship, ensure it is out of passion and not just for making money.
In the current complex economic environment, entrepreneurship requires more passion and preparation.
8. Exercise.
The body is the capital of revolution. After achieving success, pay more attention to your health, or your wealth will be unsustainable.
By following these eight notes, you can not only protect the wealth you have earned in the cryptocurrency world but also enjoy the true joy that financial freedom brings.
Remember, success is a journey, not just a destination.
Trading cryptocurrency without reviewing is futile, even if there are vast profits. Taking the time to share four iron rules with everyone, only after understanding can one trade cryptocurrency to support a family!
Recently, market changes are unpredictable, and many opportunities are fleeting. 'When soldiers come, the generals block; when water comes, the land gathers' is a quality that a qualified cryptocurrency trader should possess. Using ten years of experience, I summarize six iron rules for cryptocurrency trading to share with everyone!
The only enemy on the path of trading cryptocurrencies is yourself.
Investing is actually a high-threshold industry, but you only need a mobile phone/computer, a phone number, and an ID card to enter the CEX cryptocurrency trading market. However, this does not mean you will make money. The cryptocurrency market is ultimately a market composed of people, where human greed, anger, ignorance, sloth, and doubt are vividly expressed.
01 About Gambling and Altcoins
Playing with altcoins is gambling; holding Bitcoin is the right path. This is a rather peculiar saying in the current market; dollar-cost averaging Bitcoin is highly recommended by many experts, but none of these experts' success stories can be separated from altcoins, even CX coins.
Listening to experts promoting dollar-cost averaging Bitcoin and then blindly starting to dollar-cost average, isn't that gambling?
Whether it's gambling doesn't depend on the coin but rather on the gambler's mindset: ignoring the current trend and operating based on their greed, fear, and hope. For many, the cryptocurrency world is purely a large casino, and many also see the A-share market as a casino.
Viewing the market and the cryptocurrency world with this mindset, such individuals do not need to stay here; wouldn't it be more enjoyable to have some fun in Macau? Viewing the market with a gambler's eye will inevitably lead to a miserable outcome. The moment you step into the market with a gambler's mentality, you are already caught in the web of karma, and the tragic ending is predetermined; no matter how you struggle, it's still a gamble.
Returning to Bitcoin and altcoins, there are always people who demean the altcoin community. Without the initial altcoin Ethereum, could Bitcoin have achieved its current success? Bitcoin, as a pioneer, and later altcoins have a symbiotic relationship rather than a competitive one. Bitcoin itself cannot fully unleash the potential of blockchain and needs altcoins to extend and expand it. In comparison, for ordinary investors, high-quality altcoins can be a better choice because they offer relatively higher odds.
However, there is a fundamental fact: in the long run, only a few altcoins can outperform Bitcoin. Of course, in any market and era, only a small group of individuals can become legends.
02 About Contracts and Technical Analysis
Like altcoins, contracts are also a double-edged sword; futures contracts in the cryptocurrency space are basically equivalent to a casino.
I had never been exposed to contracts before, and the external voices said that playing contracts was just giving away money. Many cases of losing everything were reported, leading to a huge misunderstanding of contracts. It wasn't until I started to engage with contracts at the beginning of this year that I realized contracts can be a great tool.
The main reason contracts are criticized is due to liquidation, which depends entirely on the person. I only invest a small portion of my total capital in contracts, and I further divide the contract capital into ten pieces for operation, always setting stop-loss orders for each trade. Although I haven't made a profit, after making hundreds of trades, I haven't faced liquidation.
As a tool, contracts themselves are neither good nor bad, but depend on the user.
Because of my engagement with contracts, I had to delve into technical analysis. Like everyone else, I used to think technical analysis was nonsense, a post-fact analysis. It remained that way until I engaged with it myself and realized it was not the case. Technical analysis is not about making predictions; that is the work of a charlatan.
The essence of technical analysis:
Technical analysis is essentially a translator. There are many factors in the market that affect cryptocurrency prices, and you do not know which factor holds the most weight. But all factors will form a definite result, which is the price. Technical analysis describes what has happened in the market through price; this is its value, a language that people can understand.
The greatest change that technical analysis brought me was knowing how to avoid risks. For example, I recently bought an IEO coin that increased nearly 8 times. In the past, I would either panic and sell halfway, missing out on later profits, or hold on after experiencing the peak, only to be stuck. Now this coin has already dropped by half. This time, using a simple long and short moving average system, I found that this coin had shifted from a bullish market to a bearish market on a larger time frame, indicating a high risk of decline, and I sold in time to preserve most of my profits.
People are easily influenced by external voices, leading them to reject or favor something they have never understood. This is a problem that must be changed.
03 About Greed and Fear
Rejoicing in others' success and lamenting one's own failure. When prices rise, it is a revolution; when they fall, it is a scam. Emotion is always the biggest obstacle on your investment journey because it disrupts all your plans. In fact, many people have trading plans; they sell as soon as their planned selling point appears and buy when their buying point appears. But with emotions involved, the result often goes against their plans.
For example, during the crash on March 12, many said their trading system had already signaled a sell before March 12. However, due to the market's fervor and endless expectations for Bitcoin's halving, they didn't want to miss out on the big halving trend, and greed took over completely. March 12 was the biggest retribution; boundless joy and expectation turned into endless despair.
No trend is worth fearing or being surprised about. If you are still fearful or surprised by any trend, it shows you are still being controlled by emotions, and you should continue to refine yourself in the current trend until all that fear and surprise evaporates.
How to eliminate greed and fear? The most common method is to be continually washed by the market; here I have a more convenient method—Zen's method of contemplating the topic.
I consider myself a half-hearted Zen enthusiast, meditating daily while contemplating the question, 'Who is the one chanting the Buddha's name?' but internally questioning, 'Who is it that is chanting?' This is the contemplation method, which can also be applied to various thoughts, such as 'Who is initiating the greedy mindset?' and then following it down. You will soon have a question: where did this thought originate? In fact, at this point, the greed has already disappeared.
The same reasoning applies to 'Who is afraid?' and 'Who is happy?' etc.
04 Summary
People are easily disturbed by external factors and may inexplicably reject or favor something they have never understood. Emotionally, they are prone to bias due to the volatility of K-lines, while the true voice of the market is always in the present.
Investing is very similar to self-cultivation; through different methods, you refine your character, clearing layers of confusion to grasp the truth. Investing is a form of practice, and on this path of practice, your only enemy is yourself.
Will the cryptocurrency world be the only way out for ordinary people?
I have been in the cryptocurrency space for nearly ten years and want to tell everyone that if you want to change your fate, you must try the cryptocurrency world. If you can't make money in this circle, ordinary people may really not have many opportunities in their lives.
Traits of Excellent Traders
First and foremost, excellent traders must be patient individuals who can endure prosperity!
Market Cycle Theory
'Five Poor and Six Absolute' is the same every year. According to cycle theory, there are actually not many optimal times for trading cryptocurrency throughout the year. 'Five Poor, Six Absolute, Seven Still Uncertain,' I usually remain in cash and observe during May, June, July, and August each year.
So when is a good time to enter the market?
1. Enter the market at the end of September and clear positions by the end of November.
2. Enter the market before the Spring Festival and clear positions in April.
3. Execute these two iron rules; of course, individual short-term operations on small-cap stocks are not included.
4. Next, learn how to find hundredfold coins and achieve wealth during bull markets.
If you adhere to these ten principles of cryptocurrency trading, you will definitely reap abundant rewards in the end.
Market Trading Principles:
1. Don't easily let go of low-priced chips: stay firm in your beliefs and prevent manipulative selling by the market makers.
2. Chasing highs and cutting losses with full positions is always a huge taboo: under favorable conditions in a major trend, building positions gradually during declines is lower risk, lower cost, and can yield greater profits than chasing highs.
3. Reasonable profit allocation: maximize the release of funds rather than blindly increasing positions.
4. Protect your capital in sudden surges and drops: always maintain a good mindset, avoid speculation, impatience, greed, and fear, and do not make unprepared moves.
5. Rely on experience and judgment for low-priced coins in private placements: secondary market speculation requires skills and information; do not lose sight of the main objectives, or it could easily lead to chaos.
6. Layer and segment your position building and exiting: Gradually widen the price range, effectively controlling the risk and profit ratio.
7. Familiarize yourself with the interconnected effects: no cryptocurrency exists in isolation; many tools can help view cryptocurrency information and consultations, and understanding these interconnections is very important.
8. Position allocation must be reasonable: the allocation of hot coins and value coins must be balanced, not too conservative to miss opportunities, nor too aggressive to face high risks. Value coins are primarily stable, while hot coins fluctuate violently, potentially soaring or plummeting.
9. Having coins on the market, money in the account, and cash in the pocket: this is the safest and most reassuring standard configuration. You cannot go all in; doing so will lead to certain death. Mastering risk control and reasonable fund allocation is key to determining your mindset and success; idle funds for investment are fundamental.
10. Master basic operations: learn to extrapolate and grasp the fundamental thinking behind trading. Observation is a prerequisite; remember each high and low as reference data, learn to record, summarize materials, cultivate a reading habit, and develop the ability to filter and sift through information.
Summary
Through these principles, combined with the cyclicality of the market and reasonable capital management, I believe you will gain something in the cryptocurrency world. Remember, opportunities and risks coexist in the cryptocurrency space; only by mastering the correct methods and mindset can one stand undefeated in this turbulent market. I hope these experiences can help you.
All of the above are summaries of my ten years of trading experience and skills in the cryptocurrency market, which may not be applicable to everyone. Each person needs to combine their practice to utilize these summaries. As a trader, the scariest thing is not having technical issues, but rather a lack of understanding, falling into trading traps unaware! There is no invincible trading system, only invincible users of trading systems! This is the truth; ultimately, trading systems must return to the individual!
