I quit my job to trade cryptocurrencies full-time to support my family! I've been in the crypto space for 10 years now! Initially, I went through a very painful period, starting with the 1 million account my dad gave me; it was his life's work! I thought I could double it with no problem, but reality was far from ideal... I aggressively lost 980,000, leaving me with only 20,000... I really have no words; I think back to how I lost it all!
1. Blindly trust others
2. Not diversifying positions, often operating with half a position or more
3. Unable to take profits or cut losses
4. Lacking a personal style or model (not knowing how to trade short-term, mid-term, or long-term!)
These issues have confused me for three years! Later, when my husband discovered my losses, there was a lot of arguing. Suddenly, I felt very guilty towards my dad, as he entrusted his life's work to me, and I lost it all in three years! My mindset collapsed! I even thought about giving up and leaving the market!
But thinking about relying on a job, how many years will it take to earn back the 800,000 lost? So I communicated with my husband for a long time and used the remaining 200,000 to start anew! Reflect on problems, summarize problems, and avoid problems!
Afterwards, I started to achieve stable returns, making back over 8 million with the subsequent 300,000! Now I can consistently generate income to support my family every year! Combining short-term and mid-to-long-term strategies with a stable approach ensures stable returns!
Today, I’m sharing 20 trading rules and practical strategies that I’ve accumulated over the years! If you find it useful, please like and follow; if not, feel free to say whatever you want!
I am fortunate to have encountered a benefactor who helped me completely understand!
Many people have lost money trading cryptocurrencies dozens of times and still haven't realized: this market is about knowledge, not luck! I was once a novice myself until I met an experienced mentor who turned a few thousand into over a hundred million!
He said: "The real breakthrough in trading is when your thinking is reshaped and your rhythm is corrected; the market becomes transparent to you."
I didn't understand it back then, but now, I've completely figured it out!
I may not be the best at trading cryptocurrencies, but I can achieve stable profits for 10 years! I rely not on luck but on systematic thinking + trading logic!
Your losses are not due to lack of skill; it's that your thinking is stuck!
In the past, I would get dizzy just staring at K-lines. Now, watching the market is like reading a story; I can interpret the intentions of the main players from every fluctuation!
The following practical tips are too valuable not to share with all the brothers who have been losing money: Look at the bullish and bearish: Focus on the day's high and low points, breaking through the previous day's extreme values = direction change signal
Look at momentum: A rise ≠ a trend; no breakthrough of key levels = inducement to buy and sell
Look at volatility: Increased volatility = opportunity is coming; Shrinking to the limit = eve of a trend change
Look at patterns: Monitor the daily K-line for support and resistance; if there is no change, trade according to the rhythm, and adjust strategies if there are changes.
Look at the trend: if the overall trend is down, be cautious with short positions; if the overall trend is up, be careful with short positions!
Here's another phrase to remember: when the Bollinger Bands widen, look for a single direction; when they narrow, look for consolidation; when the bands turn, it's a signal for a pullback or rebound!
I only speak the truth: the market is not lacking in opportunities; it's just that you don't know how to play! The moment you truly understand, you'll find that making money is not as hard as you think!
Position management — The key strategy for successful investment in the cryptocurrency space
In cryptocurrency investment, excellent position management means you have surpassed most participants. Position management directly affects your risk level, average holding cost, and final profit level; its importance is second only to choosing the correct investment direction and maintaining a good mindset.
I. Definition and Importance of Position Management
Position management refers to the process where investors formulate plans for entering, increasing, decreasing, and closing positions when deciding to trade in the market, and comprehensively control each aspect. Effective position management can not only effectively mitigate risks but also minimize losses and maximize profits. Many traders fail largely because they overly rely on market analysis and neglect the importance of position management. In fact, market analysis is merely foundational work; what truly determines winning or losing are the subsequent operations after buying, especially position management, which includes capital management and risk control.
II. Analysis of Position Concepts
Position refers to the ratio of the total amount an investor uses for trading to the funds already used for completed transactions. For example, if you have 100,000 yuan for trading and have already invested 30,000 yuan in digital currency, your position is 30%, or three layers of position. This buying behavior is called opening a position. Furthermore, terms like half position, light position, heavy position, increasing position, reducing position, clearing position, holding position, and bottom position represent different capital occupancy situations.
III. Six basic principles of position management
Never go all in; ensure sufficient reserve funds. Just as a battleground needs a reserve team, not going all-in can avoid passive situations arising from market fluctuations, leaving room to respond to unknown risks.
Buy and sell in batches, diversify risk, lower costs, and increase profits. Batch operations allow you to have a lower average purchase cost, thereby increasing profits.
In a weak market, use light positions; in a bull market, use heavier positions. In a bear market, do not exceed half a position, while in a bull market, the recommended maximum position is 8 layers, keeping 20% for short-term or emergency funds to deal with unexpected situations.
Follow the market, adjusting positions flexibly. Based on market changes, appropriately increase or decrease positions, such as increasing positions when the market is favorable or not easily increasing positions when the market is unclear.
During sluggish market conditions, it is advisable to temporarily hold cash while waiting for opportunities. In specific periods, such as the end of a bull market, the beginning of a bear market, or when the bottom is not stable, it may be appropriate to hold cash or a light position for a short time while waiting for the right opportunity. However, long-term non-participation in the market may lead to a loss of sharp market perception.
Optimize position structure, eliminate weak currencies. Regardless of rising or falling, as long as there is volatility, it implies opportunity; timely adjustments to your position composition are necessary, discarding underperforming currencies to capture more market opportunities.
The above six principles apply to both spot trading and contract trading.
The core technique of position management is batch operations, which means dividing capital and executing position openings, increases, or decreases in batches. Batch operations can be completed in a short time or gradually executed over a longer period.
Understanding and mastering the above position management principles and methods, whether in spot or contract trading, will provide you with clear direction and strong support in your cryptocurrency investment journey.
In the trading process, finding a suitable entry timing is the biggest challenge. Today, I will share five trading entry logics; same structure, different perspectives, and I believe this can help you!
1. Trend line entry
Catch the rhythm of continuation → As long as the trend is upward, the bullish rhythm is not disrupted; if it doesn't break, there is value in speculation.
2. Horizontal support entry
Look at interval boundaries → The market's repeated back-and-forth points are the bullish/bearish balance point; a retest confirmation is a second opportunity.
3. Fibonacci 0.618 retracement entry
Betting on inertia adjustments → Most pullbacks stop at golden ratio points, essentially a probability game of "rest after rising."
4. K-line pattern entry
Read market intentions → Patterns such as engulfing candles and hammers directly express bullish or bearish attitudes; capture immediate responses.
5. Enter based on multiple signals
Seek probability resonance → Trend lines, horizontal lines, K-lines, and other clues overlap at the same position, approaching the "maximum probability value."
The five logics have no right or wrong, and only depend on your chosen market observation perspective.
Are beginners always losing? Are experienced traders also falling into traps? The core issue lies in failing to grasp the essence of multi-timeframe resonance! Use the 4-hour to determine direction, the 1-hour to find levels, and the 15-minute to seize opportunities for precise targeting of the market!
1. 4-hour K-line: Trend direction control
Function: Filter short-term fluctuations, lock in the larger direction
① Upward trend: High points and low points rise simultaneously → Buy on pullbacks
② Downward trend: High points and low points decrease simultaneously → Short on rebounds
③ Horizontal consolidation: Avoid frequent operations, wait for trend clarity
2. 1-hour K-line: Precision locator
Task: Lock in key support/resistance levels
① Close to trend line, moving average, previous low → Potential entry point
② Reach previous high, resistance level, top pattern → Take profit/reduce position signal
3. 15-minute K-line: Entry trigger
Usage: Capture the best entry timing
① Key price levels showing engulfing, bottom divergence, golden crosses, etc., indicate reversal signals before taking action
② A breakout with volume is valid; beware of false breakouts without volume
Core operation formula
4-hour establishes the bullish/bearish direction → 1-hour identifies the entry zone → 15 minutes triggers the entry
Lifeline rule
① When cyclical signals conflict, hold cash and observe!
② Small cycle fluctuations are intense; be sure to set stop-loss
③ Following the trend + precise point + timing resonance is the key to profit
How can one make money in the cryptocurrency market?
A very important principle in trading: don't make small profits, and don't take big losses.
Simply put in 8 characters, it is actually very difficult to achieve. For example: with 20,000 yuan, you opened a position, and after opening it, it rose to 21,000. You're very happy, took profit, made 5%, and felt great, but the market continued to rise to 25,000... you made 5% but missed out on 50%;
Then you tell yourself to make big money this time and absolutely not take profits; then the market returns to 20,000, and you open another position. After opening, it rises to 21,000, and you tell yourself, learning from last time's lesson, to hold on for big profits. The result? The market returns to 20,000 and falls below 20,000 to 19,500, and you stop-loss.
I'm struggling!
Many people spend their whole lives switching back and forth in such a dilemma, never escaping.
Is there a way to make money in both big and small markets?
No, it's either one or the other; I generally choose not to make small profits and patiently wait.
Trading is a long-term practice. Whether you trade short-term or long-term, making 200% on a big trend, as long as you can retain most of the profit, next time you encounter a big opportunity and make another 200%, that's four times... As long as you can preserve profits, you can compound. If you make 200% this time and then lose it all back, what’s the point? In the trading market, there’s no such thing as missing out; there are only losses and gains.
Some people may feel they have found the right path and that wealth is just around the corner.
Touching the right path only indicates that your chances of making money have increased.
In fact, this type of operation requires high levels of mindset, patience, and courage.
1. Are you willing to patiently wait for the right position?
2. Can you boldly open a position without caring about the capital, even if you lose it all? The anxiety of missing out, the urgency to secure profits after gaining, and the worry of losses after opening a position... It takes a long time to cultivate; be cautious when playing, and while pursuing profits, also be willing to experiment.
Of course, having found the path is still much better than those who are just randomly playing; many people go their whole lives without ever finding the right path.
Do you always feel that profit is out of reach and losses come one after another?
When beginners enter the cryptocurrency space, do they feel that profit seems always out of reach while losses come in succession?
Every senior trader was once a novice, growing through losses. The key is to learn from losses and avoid repeating mistakes. Today, I want to share my own profound "loss reflection summary" with you, discussing the most common loss causes for novice users and providing practical solutions.
Directly pointing to the three major "vulnerabilities" of beginners:
Trading system + discipline scattered: unable to control hands, buying and selling randomly, too many "temptations" outside the system 2. Insufficient stop-loss execution: knowing that a stop-loss is needed, yet always holding onto luck, ultimately turning small losses into big losses 3. Emotional trading at play: unwilling to accept losses, engaging in revenge trading, resulting in increasing losses.
These three points, I believe many beginners can relate to. Next, based on these three points and my years of practical experience, I will provide a deeper analysis and present a specific "pitfall avoidance" guide.
Trading system discipline: Don’t engage in trades without a "plan"
Many beginners entering the cryptocurrency space feel like headless flies, bumping around. They hear news that a certain currency is about to skyrocket and rush in; see others making money with "meme coins" and feel envious; or even trade based on feelings and luck. This kind of "freewheeling" trading method may yield short-term luck with small profits but will ultimately lead to losses over the long term.
Block out external noise and focus on opportunities within the system:
In the cryptocurrency space, information overload is prevalent, with various communities and KOLs' messages flying everywhere. Beginners can easily be disturbed by all sorts of "insider information" and "get-rich myths," shaking their trading systems. You must learn to filter out this noise and reduce unnecessary distractions. Focus your energy on researching and finding opportunities that meet your trading system's criteria, patiently waiting for your "prey."
Stop-loss execution: The "safety gauge" is indispensable
In the cryptocurrency market, which is highly volatile, the importance of stop-loss cannot be overstated. A stop-loss is like an airbag in a car; it may not be needed most of the time, but once a collision (market volatility) occurs, it can save you from significant losses.
Many beginners still find it hard to decisively cut losses in actual trading, mainly due to the following psychological barriers:
Reluctance to incur losses: Humans naturally dislike losses. Stop-loss means admitting judgment errors and accepting losses, which is psychologically difficult to accept.
Luck mentality: always thinking that the price will bounce back, waiting a bit longer might just allow me to break even. This kind of mentality will lead you to postpone stop-loss time and ultimately turn small losses into big losses, even leading to liquidation.
Solution: Overcome psychological barriers, mechanically execute stop-loss!
1. Pre-set stop-loss levels and clearly record them in the trading plan:
Stop-loss is not a spontaneous decision; it should be pre-set in the trading plan. Before opening a position, you should clearly set a stop-loss level based on your trading system and risk tolerance and record it in the trading plan.
2. Execute stop-loss mechanically like a robot; never let emotions intervene:
Once the price hits the stop-loss level, execute the stop-loss without hesitation, like a robot. Do not look for any excuses, do not hold any illusions, and do not intervene artificially. Remember, stop-loss is to protect capital, avoid larger losses, and leave room for future profit opportunities.
3. Use tools to assist with stop-loss:
You can use the stop-loss function of the trading platform to pre-set stop-loss orders. Alternatively, set a phone alarm to remind you near key stop-loss levels.
4. Review stop-losses and positively reinforce stop-loss behavior:
After each stop-loss, do not feel discouraged; review and analyze whether this stop-loss was reasonable. Was the stop-loss executed properly? Summarize the experiences and lessons learned.
Emotional management: Taming the "wild horse of emotions"
In the cryptocurrency market, which operates 24 hours a day with dramatic price fluctuations, it is easy for people's emotions to fluctuate. Especially during consecutive losses, it becomes easier to fall into emotional traps and make irrational trading decisions. Many people clearly know that revenge trading is wrong, but when emotions run high after losses, it remains difficult to control oneself, resulting in even greater losses.
1. Hot coins should not be clung to; when profits from altcoins reach a certain level, they should be exchanged. Trying to ride a coin from start to finish is bound to be a disappointment; it's simple logic that altcoins cannot rise indefinitely. When the hype is over, it's time to exchange; otherwise, if it drops back to square one, all the effort will be in vain, just like the past FIL and LUNA.
2. High-level consolidation followed by a surge; grasp the opportunity to prepare to sell: Low-level consolidation with new lows likely presents good opportunities. When the currency price consolidates at a high level and then creates a new high, be cautious of the main players' inducements; when to reduce positions or exit, do not hesitate. When the currency price consolidates at a low level and then creates a new low but quickly rebounds, it is likely the main player’s last wash; at this time, one should remain firm and undeterred.
3. When the market environment is not good, and the price is consolidating against the trend, a small rise may lead to a large increase; when the market environment is good, a currency price consolidating against the trend may lead to a small drop, and a small drop can lead to a large drop.
4. Only add to positions when making profits; do not average down on losses. This may break many people's perceptions. Our position should be increased when the currency price breaks through previous highs, not when it is continually falling. Otherwise, the more you average down, the more you lose, and eventually, you will be unable to move. You must cut losses short and let profits run.
5. Once you identify the bottom price, typically there will be a two-step rise; at this point, don’t doubt it, as a big surprise generally follows, especially when experiencing a trend upward, which involves both rising and washing out; don’t get off easily.
6. Top players first look at sectors, second-tier players only look at individual coins, third-tier players look at indicators, and the lowest-tier players just gamble. This means that when we buy a particular coin, we must first look at the sector; only by engaging in hot sectors can popularity and win rates be high. Next, look at the token, and only looking at indicators is for novices; those who are just looking at everything are gamblers.
7. Indicators vary with volume and price, so volume and price are the roots of indicators. Not looking at volume and price while relying on indicators can lead to disappointment in cryptocurrency trading. Indicators are all calculated based on the currency price and trading volume, so true technical analysis requires looking at volume and price; price increases require significant capital to drive them.
8. In an upward trend, look for support; in a downward trend, look for resistance. When the currency price is trending upward, operating based on the support line has a high success rate, providing opportunities for buying on dips. In a downward trend, operating based on resistance lines has a high success rate, allowing for short positions or exit opportunities.