I am 38 years old this year, from Wenzhou, Zhejiang, and currently live in Singapore. I hold long-term positions in five mainstream cryptocurrencies, own two seaside properties, one in Sanya and one in Phuket. After ten years in the crypto space, I have grown my initial capital of 300,000 to over 100 million in assets, not relying on news or leverage, just using a method that my peers laughably call 'clumsy'.
Today I will share the bloody path I have walked for these 2190 days. These six practical iron rules, understanding one can save you from losing a house in a bear market; if you can follow three rules, you can shake off 95% of the retail investors.
First rule: The longer the sideways movement, the more explosive the breakout, but keep a close eye on the 'breakout point'.
Don’t think that a sideways market is stagnant; it’s a tug-of-war between bulls and bears. For coins that have been sideways for more than 30 days, once they break out above the box with increased volume, they can often rally more than 30%; but if they break down below without increased volume, run quickly, as the main force is secretly dumping.
Rule two: A sharp rise with a long upper shadow is not an opportunity, it’s a trap.
A large bullish candlestick suddenly soars, but the tail is dragged long; this is not about to take off, it's the main force dumping goods at a high altitude. When this 'shooting star' appears more than three times, regardless of what happens afterwards, it is a trap for retail investors, and entering means picking up the scraps.
Third rule: The 'three soldiers' during a downtrend are mostly a dead cat bounce.
Three consecutive small bullish candles; does it look like a rebound? Don’t be foolish, in a bear market this is mostly the main force creating a 'false rebound' to trick you into buying. The real bottom must be 'short green bars + shrinking volume doji', that’s the sign of a thorough decline.
Fourth rule: If the trading volume suddenly increases by more than 10 times, be cautious regardless of whether it goes up or down.
Normally trading several million a day, suddenly one day it spikes to several hundred million; this is not the arrival of a windfall, it’s the main force 'matched trading'. Either they want to raise the price to sell, or they are creating panic to accumulate. In such times, it’s better to observe more and act less; wait until they are done before acting.
Fifth rule: Trading cryptocurrencies is not about guessing the ups and downs, it’s about calculating the 'risk-reward ratio'.
Stop always thinking about buying at the lowest and selling at the highest; that’s something only a deity can do. Before placing every order, calculate clearly: if I’m wrong, what’s the maximum loss; if I’m right, what’s the potential gain. If this ratio is below 3:1, it’s better not to trade; over the long term you’ll find that minimizing losses is actually making a profit.
Rule six: 'Waiting' is the highest level in the crypto space.
Wait for the trend to clarify before acting, wait for signals to confirm before entering, and be greedy when others are fearful. 90% of losses stem from 'not being able to hold back'; it’s not that there are few opportunities, it’s that you are too impatient. Those who can control their hands have already made a fortune.
The crypto space has never lacked stories of sudden wealth, but those who survive are the ones who understand the rhythm. It's not that you're unlucky, it's that you're always doing the wrong thing at the wrong time.