I am a full-time cryptocurrency trader; for the past decade, I have adhered to the ten golden rules of the crypto space. Reading them a hundred times is not too much; they must be remembered!
In the first three years of trading cryptocurrencies, I entered the market with 200,000 capital and ended up with only 10,000 left. Relatives and friends advised me to stop trading, saying it was foolish and irresponsible. I heard all sorts of harsh words, and at that time, I almost gave up and looked down on myself.
But I was unwilling, swearing to my family that I would make one last bet with this 10,000! Then I calmed down and studied, unexpectedly earning 25.6 million from that 10,000 in three years!
No bragging, when you really find a method that suits you and strictly follow it, you will surely turn your situation around!
In the cryptocurrency space, 90% of losses come from frequent trading.
But the true top players rely on 'rolling positions' to achieve exponential growth in assets.
What is rolling positions?
Rolling positions mean letting profits run, not hastily cashing in.
Casual players: Take profit at 10% and miss the big market.
Rolling position players: Average down with profits, letting the trend work for you.
The core logic of rolling positions.
Trend is king: Only roll positions in a bull market or strong trend; not applicable in a choppy market.
Use profits to average down: Use profits to seek greater profits, not risking your principal.
Move the stop loss up: As profits grow, gradually raise the stop loss level to lock in profits.
Incorrect rolling positions = gambling, correct rolling positions = compound interest machine.
Practical skills for rolling positions
(1) Confirm the trend before acting.
(2) Pyramid averaging method.
First position: 20%-30% of capital for testing.
Trend continuation: Use profits to increase positions in batches.
Finally, your position should not exceed 50% of your total capital.
(3) Dynamic profit taking, let profits fly.
Break below the 10-day moving average? Reduce positions by 50%.
Break below the 20-day moving average? Liquidate positions.
Volume surge with stagnation? Take profits in batches.
Remember: You won't go bankrupt by taking profits, but you can go to zero due to greed.
4. The deadly traps of rolling positions.
Rolling positions against the trend: Averaging down in a downtrend, resulting in deeper losses (typical example: stubbornly holding positions).
Excessive leverage: Rolling positions ≠ going all in; high leverage accelerates liquidation.
Emotional trading: FOMO leading to full positions, panic leading to cutting losses.
5. The highest realm of rolling positions: governing through non-action.
After building a position, look at the market less, trade less.
Let the market move itself; you are only responsible for following the trend.
80% of profit comes from 20% of the time; enduring loneliness is key to maintaining prosperity.
Two steps to transform from a victim to a hunter; the market makers are already starting to panic!
First move: Playing dead is a great tactic; the market makers are helpless!
I know you're currently as anxious as an ant on a hot stove, but remember Bo Fu's words: The market makers fear not your cuts, but your playing dead! If you cut losses now, you’re effectively giving money to the market makers! Do you think the market makers are raising prices to help you make money? Naive! They aim to have you buy at high prices and obediently hand over your bloody chips!
So, the first step is to close the trading software; eat and drink as you please! The market makers drop prices to instill panic; the more anxious you are, the happier they are! Remember, bull markets see more crashes, bear markets see more rallies; the current pullback is just giving you a chance to average down at a low point!
Second move: Pyramid averaging, reduce costs to make market makers cry!
Just playing dead is not enough; we need to take the initiative! The pyramid averaging method is your secret weapon! In simple terms, the more it drops, the more you buy! For example, if you're stuck at 4650 and it drops to 4500, buy a little first; if it drops to 4300, buy a bit more; if it drops to 4000, go in heavy! This way, your holding cost will slide down like a slide, making the market makers want to spit blood!
But! Attention! The money used for averaging down must be spare cash! Don't stake everything you have, or you'll become the market maker's ATM!
Nine key points for making money in cryptocurrency trading.
Here are the nine key points I’ve learned over the past decade that have allowed me to achieve financial freedom in the cryptocurrency space.
1. Don’t rely on luck. If your winning trades outnumber your losses, and your account is gradually growing, it indicates that your method is correct. But if you have nine wins and one heavy loss wipes everything out, be cautious. Don’t go all in casually; if wrong, stop loss promptly and adjust your strategy.
2. Trust your own judgment. Sometimes you might be right, but change your mind after hearing someone else’s opinion, resulting in a loss. Investing requires your own perspective; those who make money in the market are often in the minority.
3. Learn to read the trend. The cryptocurrency space has ups and downs; following trends makes it easier to profit, while acting against the trend carries significant risks. Learn more about technical analysis to improve your market judgment.
4. Control risk. The crypto space is highly volatile; avoid going all in. Start with a small position for testing, and if the trend is right, then increase your position. Set stop losses for every trade; don't be greedy or hesitant.
5. Be patient and wait for opportunities. Don't rush to buy when prices rise; find the right position before entering. Better to miss out than to make a mistake.
6. Leave when you should. Cash out when you reach your target; don't think about making more, or you might end up losing. If you lose, also decisively stop loss; don’t fantasize about breaking even; preserving your principal is the only way to keep playing.
7. Maintain a good mindset. Investing is not a one-day affair; it’s normal to have both gains and losses. Regardless of current profits or losses, stay calm, summarize experiences, and over the long term, you can achieve stable profits.
8. Pay attention to news + technicals. Sometimes a big piece of news can dramatically change the market, so don’t just look at technicals, also pay attention to market dynamics.
9. Only use spare money for investment.
Borrowing money to trade cryptocurrencies adds pressure and leads to erratic operations. It’s best to use money that won't affect your life, so your mindset remains stable and your actions more flexible.
Trading: Dancing with emotions, anchored by the system.
Trading acts like a magnifying glass, infinitely highlighting the weaknesses of human nature—panic during sudden crashes, heavy investment during all-in moments; every extreme situation can send adrenaline levels soaring and hearts racing.
The difficulty in trading lies in the fact that we are 'emotional beings'. Emotions can severely disrupt decision-making, letting rationality yield to impulse; conversely, emotions can also be a source of creativity, serving as invisible antennas to sense market temperature.
People often say 'top traders have no emotions,' but I believe that's not entirely true. Truly excellent traders do not eliminate emotions but possess the ability to counter them—a self-handling mechanism that can stabilize actions and act according to rules during emotional surges, and this is, in itself, the core of a trading system.
Almost all traders understand that 'good trading requires a system', but most fail because they 'cannot accept system losses': once a loss occurs, they rush to modify parameters and adjust logic, and in the end, even the core strategy that once brought them profits gets completely distorted. Ultimately, the trading curve slides downward in this unstable cycle of repeated trial and error.
Even Wall Street’s 'money printer', legendary hedge fund manager Simons, once said: 'If you don't follow your system for a long enough time to let it work and profit, then no trading system will work.' His fund, with continuously iterated quantitative models, achieved almost unmatched returns—this kind of pure quantitative system almost eliminates emotional interference, but also has a fatal shortcoming: it cannot handle large funds since this kind of 'precise arbitrage' lacks market capacity.
Thus, a system that truly leads to success is never about 'never losing money', but about 'allowing losses and executing rules with iron discipline after losses'. Only through a long enough historical backtest can one understand the operating rules of the system and identify potential risks; only by finding one's trading edge in historical data, maintaining that edge, and using discipline to avoid disadvantages can a system have vitality.
In the crypto space, you need to understand an unchanging principle for a thousand years—do not engage in 'licking sores-style trading'.
During the Warring States period, Cao Shang made a fortune by flattering King Qin and went to show off. Zhuangzi criticized him: 'The King rewards doctors; those who suck on sores get five carts, and the more disgusting the act, the greater the reward. Your hundred carts might as well have licked the King's sores clean!'
This situation feels very familiar in the crypto space. Some people chase after big shots calling them 'teacher', dare to go all in when a project paints a rosy picture, and flood the community with praise for KOLs' nonsense; isn’t this just a modern version of 'licking sores'?
You think you've found wealth, but you’re really repeating Cao Shang's path: trading dignity for short-term benefits. The 'insider information' from big shots and 'priority subscriptions' from project parties often resemble King Qin's rewards—the more they coax you to lower your stance, the deeper the pit might be.
Look at those endings: Deng Tong from the Han Dynasty sucked the pus from the emperor's sores and ended up starving; in the crypto world, who hasn't been burned by trusting the wrong people or projects?
Zhuangzi once said: 'It's better to play in a small ditch than to be a dog for the powerful.' The true survival path in the crypto space is to maintain your judgment. Don't seek security by kneeling before the big shots, and don't trade blind faith for false opportunities. Holding firm to independent thinking is stronger than anything else—after all, once you've gotten used to bending your knees, it's hard to stand straight again.
A must-read for cryptocurrency contract newbies regarding leverage.
What is leverage? Simply put, it’s 'borrowing power'.
Imagine this: You use 100 (margin) and leverage 5 times, allowing you to operate assets worth 500. If it rises 10%, you earn 50 (equivalent to 50% of your principal); but if it drops 10%, your 100 is wiped out (liquidation).
Why should newcomers be extremely cautious?
1. The speed of loss amplification far exceeds imagination: With even slight market fluctuations, your principal can vanish. This is not to scare you; it’s a painful lesson that many have learned.
2. 'Going to zero' is not a legend: Under high leverage, a single large fluctuation can wipe out the account, leaving no chance for averaging down.
3. Emotion is the biggest enemy: It's easy to 'get high' during losses, wanting to leverage to recover, often leading to deeper traps.
How to use leverage in a relatively 'reasonable' way? (Core principles)
1. Etch 'low' in your mind!:
Newcomers are strongly advised to start with 1-5 times leverage! ** Don’t think it’s too low! First, feel the market fluctuations and the power of leverage. With 5x leverage, a 20% adverse price movement leads to liquidation; the risk is already significant.
Experienced players also recommend keeping it within 10 times. ** True experts rely not on high leverage to gamble, but on strategy and risk management. Exceeding 20 times? That's hardly different from gambling, be very careful!
2. Position management is crucial!:
The amount invested in a single trade should always be just a small part of your total capital! Recommended not to exceed 5%-10% (for example, if you have 10,000 U, use only 100-500 U for a single contract). Never go all in!
High leverage must be paired with lower positions! ** If you're using 10x leverage, the position should be halved compared to using 5x. Ensure that even if losses occur, they won't be devastating.
3. Stop loss! Stop loss! Stop loss! (Important things are worth repeating three times!)
Always set stop losses when opening a position! This is your only 'safety rope'. Based on your risk tolerance and technical analysis (for example, just below the support level), preset the maximum loss point you can accept, and let the system execute automatically!
Never move your stop loss to hold a position! Holding onto delusions during losses often leads to catastrophic consequences.
4. Recognize the trend and follow it.
Leverage is more suitable for relatively clear and smooth trend markets. Using high leverage in choppy markets leads to frequent losses.
Don’t leverage against the trend! Don't think that just because it has dropped significantly, you can definitely catch a rebound; the market has its own way of dealing with defiance.
5. Maintain a calm mindset, refuse greed:
Using leverage is to utilize funds more efficiently, not to 'get rich overnight'.
Set reasonable profit targets; once achieved, consider taking partial profits and cashing out.
Losses are part of trading; accept them, set stop losses according to your plan, and don't let them affect your next trade.
Iron rules for survival in the crypto space: The more 'foolish', the more profit; 90% of people stumble on the path of 'smartness'.
Having crawled through the crypto space for many years, I’ve seen too many people get liquidated and lose everything. In fact, most people don’t lose to the market but to their own 'smartness'—always trying to take shortcuts and find quick fixes, while ignoring the most straightforward 'foolish methods'. Today, I will unveil the truth about survival in the crypto space; only those who can grasp it will truly survive and make profits.
1. 90% of people fall into these three fatal mistakes.
(1) Chasing highs and cutting losses, operating in reverse.
When the price of cryptocurrencies rises, people get greedy and chase in, fantasizing about 'lying down and earning', but as soon as they buy, the price drops. Yet when real panic selling happens and the bottom appears, they are too scared to enter. Remember: Only those who can turn 'buying the dip' into muscle memory are the ones who reap the rewards of the cycle; be greedy when others are fearful to truly catch the bottom.
(2) Holding onto a losing position, betting on luck
Thinking that once you identify a direction, you can 'go all in and get rich' is misleading; when the main player slightly shakes the market, you'll be washed out. The crypto space has never had a 'guaranteed profit' one-sided market; stubbornly holding onto a position only gives the market power. A true expert knows how to adapt; if the trend is wrong, cut losses, don’t stubbornly fight the market.
(3) Going all in, leaving no way out.
When emotions rise, going all in can lead to missing better averaging points even if you guess the trend right; once the market reverses, you could be wiped out. Remember: Opportunities in the crypto space are always there; keeping some bullets gives you the initiative. Full positions and going all in are for gamblers, not investors.
2. The 'six-character mantra' that 90% of people overlook is the more foolish, the more effective.
(1) Don't act blindly before a market reversal.
'High-level consolidation is not over, new highs are still ahead; low-level consolidation has no bottom, easily leading to new lows.' During volatile markets, most people lose patience and trade frequently, resulting in a back-and-forth loss. Remember: Before reversal signals appear, holding back is winning. Better to miss out than to make a mistake.
(2) Endure during the sideways period.
'Do not act during sideways movements, absolutely do not enter the market.' Choppy markets are traps set by the main players; the more you can't endure, the more likely you are to cut losses at the bottom and chase highs at the top. True experts will observe and wait during the sideways period, enduring until the reversal point before acting, maximizing their win rate.
(3) Follow emotions, align with the daily line.
'Buy on a bearish close, sell on a bullish close.' Don't blindly trust your 'market feel'; market sentiment is hidden in candlesticks. A bearish candlestick represents panic, which is a buying opportunity; a bullish candlestick signifies excitement, suitable for taking profits and exiting. Following market sentiment is 100 times more reliable than making decisions on a whim.
(4) Observe the rhythm, catch the rebound.
'Slow drops don’t bounce high; fast drops often lead to sharp rebounds.' Market rhythm determines opportunities: Don’t bottom-fish during a downward trend; the slower the decline, the more it shows that the selling pressure hasn't been released, making a big rebound difficult; rapid declines hide opportunities; panic selling can create golden pits, and after a sharp drop, there’s often a sharp rebound. Understanding the rhythm allows you to seize the chances.
(5) Pyramid, leaving options open.
The pyramid-style position building, entering in batches. Never go all in at once; in a downtrend, buy in batches at lower prices; in an uptrend, take profits in batches. Keep some bullets to respond to sudden market movements, and a true expert always leaves themselves a way out.
(6) After big ups and downs, wait for signals.
'After a big rise or fall, there must be consolidation; after consolidation, there will definitely be a reversal.' After extreme market fluctuations, don’t rush to go all in or cut losses; the consolidation period is a 'power accumulation period' for the bulls and bears. Wait for reversal signals (breakthrough of key resistance/support) to act, and your win rate and returns will double.
3. The truth about survival in the crypto space: Endurance is key to making money.
The market is never short of opportunities; what’s lacking are those who can 'stay steady, endure, and survive'. Don’t envy the 'luck' of experts; they have merely perfected these 'foolish methods'—using patience to combat volatility, discipline to control risks, and strategies to seize opportunities.
Remember: In the crypto space, it's not 'smart money' that makes profits, but 'hard work'. Understanding these iron rules, controlling your hands, persisting, and executing steadily will allow your trading journey to expand from being a 'victim' to becoming a 'hunter'.
Last reminder: There are risks in the crypto space; operations must be cautious. However, as long as you master these 'simple methods', you can stand firm in the market.
