(From 10,000 to 1 million: The wealth reversal path of a crypto market novice) Tested methods: A small account of 2000U has been transformed into nearly 2 million U, achieving a 1000-fold increase in one year!
If you intend to invest in the crypto space, please take a few minutes to read my answer word for word, as it may save your life and a family.
Thousands of once-happy families end up broken due to the pursuit of the unattainable dream of making a fortune in the crypto space.
I believe that my ability to continue on the trading path is due to my continuous learning. In addition to understanding the basics, I analyze news and study technical indicators, as well as developing a self-stabilizing profitable trading system!
From 50,000 to making 10 million, then going into debt of 8 million, to making 20 million, to now achieving financial freedom.
There is a foolproof method for trading cryptocurrencies that allows you to maintain 'eternal profits' and achieve 30 million!
I still use this method, which is very stable.
Everyone need not worry about whether they can learn; if I can seize this opportunity, you can too. I am not a god, just an ordinary person. The difference is only that others have neglected this method. If you can learn this method and pay attention to it in future trading, it can help you earn an additional 3 to 10 percentage points daily.
First step: Add coins that have seen price increases in the last 11 days to your watchlist, but be careful to exclude any coins that have dropped for more than three days to avoid losing profit.
Step 2: Open the candlestick chart and only look at the monthly MACD golden cross for each coin.
Step 3: Open the daily candlestick chart; here only look at a single 60-day moving average. As long as the price pulls back to near the 60-day moving average and a volume candlestick appears, enter heavily.
Step 4: After entering the market, use the 60-day moving average as a standard; hold if above, exit and sell if below, divided into three details.
1: When the price increase of a swing exceeds 30%, sell one-third.
2: When the price increase of a swing exceeds 50%, sell another one-third.
3: This is the most important and core aspect that determines whether you can profit. If you buy in the morning and the price unexpectedly breaks below the 60-day moving average the next day, you must exit completely; do not harbor any delusions. Although the probability of breaking below the 60-day line using this monthly and daily selection method is very low, we still need to have risk awareness. In the crypto space, preserving capital is the most important thing. Even if you have already sold, you can wait for the right buying opportunity to buy back.
Ultimately, the difficulty in making money lies not in the method but in execution. 'If the price directly breaks below the 60-day moving average, you must exit completely; do not harbor any delusions.' Just this one sentence has eliminated 90% of people.
Everyone comes to the crypto space with the same intention, and there's no doubt about it. If you're just here to kill time, then this place is not for you.
Here is a compilation of trading behaviors; understanding this chart can increase your win rate to 90%.
I. Basic principles of investment.
Never trade without reviewing the price chart: Never trade in the crypto space without looking at the price chart.
Avoid buying on good news: Never buy when positive news is released, especially when the price has already significantly increased before the news is announced.
Don't catch falling knives: Never buy when the price drops sharply, thinking it’s cheap. Under continuous selling pressure, the price often goes lower.
Stay away from downtrends: Never buy in a downtrend. 'How low can the valuation go?' When the price drops further, you will understand the reason for the decline.
Maintain trading consistency: Always adhere to the principle of consistency in trading. If you sometimes buy and sometimes sell in the same situation, then there is a significant problem with your trading discipline.
Reveal how crypto masters use six iron rules to effortlessly achieve financial freedom!
If you want to make money in the crypto space, remember these six iron rules:
1. You should divide your money into five parts, using only one-fifth for trading at a time. If you lose 10 points, exit immediately. By doing this, even if you lose five times in a row, you would only lose one-tenth of your total capital, which won't be too damaging.
2. You must follow the market; do not go against the trend. When the market is down, rebounds can be traps; when the market is up, pullbacks can be great profit opportunities.
3. Never chase coins that have already surged; they have risen too high and may drop at any moment.
4. You must learn to read the MACD indicator; it can help you find the best timing to enter. When the DIF and DEA lines cross below the zero axis and then cross above it, that’s a good buying opportunity; if they cross above the zero axis and then go down, that’s a signal to sell.
5. Remember, never average down when losing money; increase your position when making profits. You need to observe the relationship between volume and price; if the price breaks out with volume at a low point, it may rise; if it fails to rise at a high point with volume, then it’s time to run. When selecting coins, choose those with good trends and value.
6. Review your trades weekly, noting what you've done well and what has not gone well, and adjust your strategies in a timely manner.
These six iron rules are all lessons learned through my blood; follow them, and you can definitely thrive in the crypto space!
Traders must understand and master these 16 essential candlestick patterns.
And with price patterns, even crypto novices can immediately master candlesticks; simplicity is key; the simpler things are, the more useful they are.
Purely practical sharing.
Candlestick charts originated from the 18th-century Japanese book 'Sakata Method' by Homma Yoshinori, which primarily documented strategies used in rice trading. The graphical representation of prices gradually evolved into candlestick lines. In Japan, candlestick lines are also called 'kei' lines, and later transliterated into 'K' lines by Westerners.
The drawing of each daily candlestick requires four prices: opening price, closing price, highest price, and lowest price.
The thin line at the top of the candlestick is called the upper shadow, and the thick line in the middle is the body. The thin line below is the lower shadow. When the closing price is higher than the opening price, indicating an upward trend, we call this candlestick a bullish candlestick, generally represented in red in the middle. At this point, the length of the upper shadow indicates the price difference between the highest price and the closing price, the length of the body represents the price difference between the closing and opening prices, and the length of the lower shadow represents the price difference between the opening price and the lowest price.
Below are 16 candlesticks and their price patterns essential for trading:
Candlestick charts are used to predict future price trends. Below are 16 common candlestick patterns and how to use them to find trading opportunities.
The candlestick chart has three basic functions: 1. The body of the candlestick represents the opening/closing price range. 2. The wick or shadow indicates the intraday high and low points. 3. The color of the candlestick reveals the market's direction—green body indicates a price increase, while red body indicates a price decrease.
As prices change, various candlesticks form certain patterns that traders can use to identify major support and resistance levels. There are many candlestick patterns, which imply trading opportunities in the market—whether it's a price trend reversal, continuation, or market indecision. Before starting to trade, it's crucial to understand the basics of candlestick charts and use their patterns to identify trading opportunities, which serve as the basis for trading.
Practice interpreting candlestick charts: When using any candlestick chart, although candlestick and price patterns are suitable for quickly predicting trends, we should also use them in conjunction with other forms of technical analysis to confirm the overall trend.
Six bullish candlestick patterns: They may form a bullish trend after a market downtrend, indicating that the price trend has reversed. They are indicators that traders consider when establishing long positions.
Hammer candlestick pattern: The hammer candlestick pattern consists of a short body and a long lower shadow, forming at the bottom of a downtrend. A hammer indicates that despite selling pressure, strong buying power eventually leads to a price rise. The color of the hammer can vary, but a green hammer represents stronger buying power than a red hammer.
Inverted Hammer pattern.
The same bullish pattern is the Inverted Hammer. The only difference is that the upper shadow is long while the lower shadow is short. This indicates buying pressure, followed by selling pressure that is insufficient to lower the market price. The Inverted Hammer suggests that buyers will soon take control of the market.
Bullish Engulfing Pattern.
Bullish Engulfing Pattern consists of two candlesticks. The first candlestick is a short red body, completely engulfed by a larger green candlestick.
The next day's opening price is lower than the first day's, but the bullish market drives prices up, ultimately attracting more buyers.
Piercing Line.
The Piercing Line also consists of two long bar patterns, made up of a long red candlestick and a long green candlestick. Generally, there is a significant gap between the closing price of the first candlestick and the opening price of the green candlestick. A significant increase in price indicates strong buying pressure.
Morning Star pattern.
The Morning Star pattern is considered a hopeful sign in a downtrend. It consists of three candlesticks: one long candlestick, between a long red and a long green. Generally, the 'star' will not overlap with longer candlesticks because there are market gaps at both the opening and closing. This indicates that the selling pressure from the first day is diminishing, and a bull market is about to arrive.
Three White Soldiers.
Three White Soldiers consist of consecutive long green candlesticks (with upper shadows), with their opening and closing positions gradually higher than the previous day. This is a strong bullish signal, indicating that buying pressure is steadily increasing after a downtrend.
Six bearish candlestick patterns.
Bearish candlestick patterns often form after an uptrend and signal resistance points. Severe pessimism towards market prices often leads traders to liquidate their long positions and open short positions to take advantage of price declines.
Hanging Man pattern is a bearish pattern equivalent to the Hammer pattern. It has the same shape but forms at the end of an uptrend. This indicates significant sell pressure, but buyers manage to push the price higher again. Large sell-offs are often seen as a sign that bulls are losing control over the market.
Shooting Star.
The shape of a Shooting Star is the same as that of an Inverted Hammer but occurs in an upward trend: its lower body is small, while the upper shadow is long. Generally, the market opens with a significant gap, then rebounds to the intraday high, closing above the opening price, resembling a star falling to the ground.
Bearish Engulfing pattern.
The Bearish Engulfing pattern occurs at the end of an uptrend. The first candlestick has a small green body, followed by a long red candlestick that engulfs it. This indicates that price fluctuations have peaked or slowed down, suggesting an upcoming market downturn. The lower the second candlestick goes, the more pronounced the trend may be.
Evening Star.
The Evening Star is a pattern made up of three candlesticks, equivalent to the bullish Morning Star. It consists of a short candlestick, followed by a long green candlestick, and a large red candlestick sandwiched in between. The appearance of this pattern often indicates a reversal of the upward trend. When the closing price of the third candlestick is below the opening price of the first candlestick, it indicates a clear bearish trend.
Three Black Crows.
Three Black Crows pattern consists of three consecutive long red candlesticks, with short or non-existent shadows. The opening price is close to that of the previous candlestick, but the closing price continues to fall due to selling pressure. Traders interpret this pattern as the beginning of a downtrend, as sellers have outnumbered buyers for three consecutive trading days.
Dark Cloud Cover.
The Dark Cloud Cover pattern indicates a bearish reversal. It consists of two candlesticks: a red candlestick that gaps up above the previous green body and closes at the midpoint. This shows that bears have taken control of intraday trading, leading to a sharp price drop. If the candlestick shadows are short, it indicates a decisive downward trend.
Four Continuation Candlestick Patterns.
If candlestick patterns do not indicate a change in market trends, we call them continuation patterns. These can help traders determine the market's resting time during indecision.
Doji.
(DOJI) When the market's opening and closing prices are very close to each other, the candlestick pattern resembles a cross or a plus sign. This type of Doji indicates a struggle between the bulls and bears, resulting in neither side gaining an advantage. A standalone Doji pattern is a neutral signal but can be found in trend reversal patterns, such as the bullish Morning Star and the bearish Evening Star.
Spinning Top.
The spinning top candlestick pattern has a short body situated in the middle of upper and lower shadows. This pattern indicates market indecision, resulting in minimal price changes: bulls push prices up, while bears pull it back down again. The spinning top is generally interpreted as a continuation pattern of either an uptrend or downtrend. In itself, a spinning top is a relatively mild signal, but it can indicate upcoming changes as it shows that current market pressure is losing control.
Falling Three Methods pattern.
The Three Methods pattern is used to predict the continuation of the current trend, whether bearish or bullish. The bearish pattern is called 'Falling Three Methods'. It consists of a long red candlestick followed by three small green candlesticks, with one red candlestick—all green candlesticks contained within the bearish candlestick's range. It indicates that the bullish forces are insufficient to reverse the trend.
Rising Three Methods pattern.
For bullish patterns, the Rising Three Methods candlestick pattern is the opposite. It includes three short red candles, sandwiched between two long green ones. This pattern conveys to traders that despite some selling pressure, buyers are still controlling the market.
Candlestick charts display market price changes over a specific period and are an important tool for entering crypto trading. Here are some basic guidelines to help you read candlestick charts.
I. Bullish candlestick patterns.
1. Hammer.
The Hammer pattern occurs at the bottom of a downtrend, with a long lower shadow at least twice the body length. It indicates that despite considerable selling pressure, buyers push the price back up to near the opening level. A green hammer is considered stronger bullish signal than a red one.
2. Inverted Hammer pattern is similar to the Hammer pattern, but the long shadow is located above the body. It usually occurs at the bottom of a downtrend, indicating potential upward movement. Even if sellers pull it down to the opening level, the price does not continue to decline, suggesting that the market may turn bullish.
3. Three White Soldiers.
The Three White Soldiers pattern consists of three consecutive green candlesticks, with the opening price within the body range of the previous candlestick, and the closing price exceeding the highest point of the previous candlestick. A shorter lower shadow indicates sustained buying pressure.
4. Bullish Engulfing.
Bullish Engulfing Pattern consists of a longer red candlestick followed by a shorter green candlestick, where the green candlestick is completely within the red candlestick's range, indicating a slowdown or impending end to the bearish trend.
II. Bearish candlestick patterns.
1. Hanging Man.
The Hanging Man pattern is similar to the Hammer pattern but appears at the end of an uptrend, indicating that although buyers are pushing prices up, significant selling foreshadows a possible bearish turn.
2. Shooting Star.
The Shooting Star is a candlestick with a long upper shadow, short body close to the bottom, usually appearing at the end of an uptrend, indicating that after reaching a high point, sellers dominate and push prices back down.
3. Three Crows.
The Three Crows consists of three consecutive red candlesticks, with the opening price within the body range of the previous candlestick and the closing price below the lowest point of the previous candlestick, indicating that selling pressure continues to push prices down.
4. Bearish Engulfing.
Bearish Engulfing pattern consists of a longer green candlestick followed by a shorter red candlestick, where the red candlestick is completely within the green candlestick's range, indicating a weakening buying pressure.
5. Dark Cloud Cover.
Dark Cloud Cover consists of a green candlestick followed by a red candlestick. The opening price of the red candlestick is higher than the closing price of the previous green candlestick, but its closing price is below the midpoint of the green candlestick, usually accompanied by high trading volume, indicating a change from rising to falling.
III. Three types of consolidation candlestick patterns.
1. Rising Three Methods.
The Rising Three Methods pattern is commonly found in an uptrend, consisting of three shorter red candlesticks followed by a continuing rising green candlestick, indicating that the market is bullish again. This pattern signals that the market will continue to rise after a brief adjustment, serving as a buy signal.
2. Falling Three Methods.
The Falling Three Methods pattern, in contrast to the Rising Three Methods, indicates that the market will continue to decline. This pattern consists of three shorter green candlesticks followed by a continuing downward red candlestick, signaling that the market will continue to decline after a brief adjustment, serving as a sell signal.
3. Doji.
When the opening and closing prices are the same or very close, a Doji pattern forms, indicating that the forces of buyers and sellers are undecided. Doji can be classified into several categories.
Gravestone Doji: Indicates a bearish reversal, with a long upper shadow and opening/closing prices close to the lowest point.
Long-legged Doji: Indicates indecision, with upper and lower shadows, opening/closing prices near the midpoint of the body.
Dragonfly Doji: Indicates a bullish or bearish market, with a long lower shadow and opening/closing prices close to the high point.
IV. How to use candlestick charts in Bitcoin trading.
1. Learn the basics.
Cryptocurrency traders should delve into the basics of candlestick charts, including understanding and identifying different candlestick patterns. Knowing different candlestick patterns and their meanings is fundamental to conducting technical analysis.
2. Combine multiple indicators.
Combine candlestick patterns with other technical indicators, such as moving averages, Relative Strength Index (RSI), and Exponential Moving Average (MACD), for a more comprehensive forecast. The combination of various technical indicators can enhance prediction accuracy.
3. Use multiple time frames.
Analyze candlestick patterns across multiple time frames for a comprehensive understanding of market sentiment. For example, while analyzing the daily chart, also pay attention to the hourly and 15-minute charts. Analyzing multiple time frames can help traders better grasp both short-term and long-term market trends.
4. Practice risk management techniques.
Using candlestick patterns involves risks; traders should practice risk management techniques, such as setting stop-loss orders to protect their funds and avoid overtrading. Reasonable risk management can help traders reduce losses and improve the success rate of trades.
Candlestick patterns are a way to observe market trends and can help traders identify potential opportunities. Combine market conditions and technical analysis indicators, such as trend lines, RSI, Stochastic RSI, Ichimoku Cloud, and Parabolic SAR for analysis. Support and resistance levels are also important components of candlestick analysis, with support indicating expected strong demand and resistance indicating expected strong supply.
V. Practical skills.
1. Trend confirmation.
Use candlestick patterns to confirm market trends. For example, the consecutive occurrence of the Three White Soldiers pattern can confirm an upward trend, while the Three Crows pattern can confirm a downward trend. Trend confirmation is an important step in formulating trading strategies.
2. Combine with trading volume.
Combine trading volume analysis with candlestick patterns. Changes in trading volume can provide additional market sentiment information. For instance, in the Rising Three Methods pattern, if the volume increases with each green candlestick, it indicates strong buying intent.
3. Backtest strategy.
Before applying candlestick patterns in real trading, backtest trading strategies using historical data. Backtesting can assess the effectiveness and stability of strategies, thereby improving trading success rates.
4. Maintain discipline.
In the trading process, strictly operate according to established strategies and risk management measures. Avoid emotional trading; maintaining calmness and discipline is crucial for successful trading.
Through in-depth learning and practice, beginners can gradually master the analysis techniques of Bitcoin candlestick charts, enhancing their decision-making ability and profit levels in crypto trading.
15 essential rules for survival in the crypto space!
Article 1: Preserving capital is essential for long-term survival in the market.
Capital is the lifeline; it must be firmly protected! Many people ignore risks in pursuit of high returns, resulting in heavy losses.
Article 2: As long as you are not greedy, making a profit is actually very simple.
Maintain a stable mindset; earning a little is actually easier to accumulate wealth.
Article 3: Concentrate your investments; do not go all-in; follow the trend.
Do not blindly diversify investments; avoid going all in; adjust strategies according to market trends.
Article 4: Avoid heavy positions; do not stubbornly hold; trade less.
Control your position; do not stubbornly hold onto losses; moderate trading will suffice.
Article 5: Enter calmly, exit decisively, and be resolute about stop-losses.
Don't rush to buy; sell decisively and strictly set stop-loss lines.
Article 6: The profits in the market are endless, but losses may be bottomless.
Don't be greedy; not all money can be earned, but losses could deplete everything.
Article 7: Once a stop-loss is triggered, exit immediately.
Stop-loss is a protection for your account and should not be hesitated.
Article 8: Long-term and short-term, securing profits is the most stable strategy.
Whether trading long or short, ultimately, you must ensure securing profits.
Article 9: The immutable truth of the market is that extremes must reverse.
Regardless of whether prices rise or fall, there is always a limit, and they will inevitably reverse.
Article 10: Don't operate without opportunity; missing out is not terrifying.
Don't force yourself to seize every opportunity; catching part of it is enough.
Article 11: Waiting for the right opportunity is more important than acting blindly.
Don't rush to find trading opportunities; patiently waiting for more favorable conditions is better.
Article 12: After achieving your goals, stop trading and conserve your energy.
Don't be greedy; exit in a timely manner after achieving daily goals to conserve energy for the next trade.
Article 13: Stop-loss is self-imposed; profits are a gift from the market.
Stop-loss is the investor's responsibility, while profits are the market's reward.
Article 14: Wealth comes from waiting, not from frequent trading.
The best investments are often obtained through patient waiting, not continual trading.
Article 15: When the mindset is fragile, strictly executing strategies is the most important.
Desire in trading can easily become uncontrollable; only by strictly executing strategies can one achieve unity between knowledge and action.
Welcome to follow Huihui; you can observe real-time trading for learning and communication, and gain insights into market directions and strategies. Regardless of the market style, knowing in advance allows for better mastery!
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