The system of hedging is based on the wave theory of candlestick patterns. In the cryptocurrency market, one day is equivalent to three years in the stock market; nearly 99% of the time in a year is spent in consolidation, with one-sided rallies occurring only 1% of the time. Therefore, hedging is an important skill in trading.

When in an upward trend, long positions are the main force, and whenever there is a rebound near a resistance level, one can open a short position for hedging without hesitation, taking profits at 500 points, with a profit rate nearly reaching 100%. This is because whenever the price reaches a major resistance level, the candlesticks tend to pull back and build momentum before attacking new highs. Conversely, in a downward trend, short positions are the main force, and whenever the price drops near a new support level, there will be some room for a rebound. Therefore, near the support level, one can open a long position for hedging without hesitation, also taking profits at 500 points, with a profit rate that nearly reaches 100%. Hedging is a supplementary position, and the size must be smaller than that of the main position, continuously opening and taking profits as one moves. A side benefit is that it can reduce the forced liquidation point to a very low level, thus avoiding potential extreme risks to a certain extent.