Recently, some friends have been asking me to share trading-related content, but I actually dislike discussing these things. Many people in the cryptocurrency space are very impatient, wanting to make quick money and are speculative. I, on the other hand, have a slow-burn personality, adhering to value investing and long-term trading. So I consider myself an investor.
What investors say, speculators naturally cannot absorb. But I can't help but want to talk more; how much everyone can absorb is up to them. In this lesson, I will first discuss the mindset with you. After being in the cryptocurrency space for a long time, you may find that many traders who maintain long-term profits always talk to you about the mindset.
Does trading still require a mindset? Then what is the mindset?
It is actually very simple. The mindset I understand can be divided into several levels:
1. Mindset: Maintain rationality, calmness, and self-discipline; do not be controlled, disturbed, or dominated by market emotions.
2. Wisdom: Accumulate insight and decision-making ability regarding the market through long-term practice and learning.
3. Skills: Master the ability to analyze and execute trades, such as fundamental analysis and technical analysis.
4. Style: Cultivate your unique trading style, such as trend trading or mean reversion.
5. Discipline: Establish suitable trading rules for yourself and strictly follow them with patience.
These five points, when integrated, form a person's trading mindset. If a person does not have their own mindset, then all trades are essentially a gamble. You might make thirty or fifty points today, but sooner or later, you will lose it all due to bad luck. Therefore, I have always advised against copy trading. The logic of copy trading is that others are making money, which has nothing to do with you. Once you get used to copy trading, it indicates that you do not understand; you lack your own thoughts and reasoning. Even if you can make some money through copy trading, it can only be luck; it does not belong to you. Once you leave the signal provider, you will not be able to continue profiting. So, if you want to make money in this space, you must cultivate your own trading mindset. The result of trading is simple; there are only profits and losses. However, transitioning from loss to profit is difficult for everyone.
The first step in establishing a mindset is to cultivate your own philosophy and taste. There are many messages in the market, constantly flowing. In the cryptocurrency space, there are at least eighty thousand KOLs, each with their own opinions and analyses; at the same time, some are bullish while others are bearish. Some things that some people speak of may seem like treasures to you, but in my eyes, they may just be nonsense. Some only believe in market analysis, while others only believe in candlesticks. In short, regardless of what you choose to believe, you must have your own philosophy and taste. There is no completely objective viewpoint in the world. What you believe is right; you must stick to it. Then, repeatedly learn, ponder, practice, and improve on this path until you form your own.
Trading rules.
This is the fifth point of the mindset: discipline. Although it sounds simple, very few people can actually achieve it; at least half of the people cannot. Once you have your own rules, you need to strictly execute them. However, most people cannot truly adhere to a rule for the long term. Why? Because there are too many temptations, and their character is insufficient. Market trends are constantly changing, fluctuating, and they always affect your mindset and emotions. Sometimes, abandoning the rules might immediately allow you to earn more or lose less. At this moment, many people will wonder whether to abandon the rules. In fact, most people will choose immediate benefits. However, once we violate the rules for the first time, it becomes increasingly difficult to ensure that we will follow them in the long run. In other words, your trading rules become invalid. The laws of market trends are knowable, but the processes and details within them are unknowable. Long-term trends are inevitable, while short-term prices depend on market sentiment. Therefore, we must adhere to the rules, which can also be called trading strategies. Because strategies have a higher win rate, trading is essentially a game of win rates.
If you can do this, then congratulations; you have achieved a unity of knowledge and action.
This is the first point of the mindset: attitude. Once you have discipline and attitude, you will find that trading is actually very simple, not as complicated as you imagine. It's like cooking a pot of porridge; before the porridge is fully cooked, it will emit a fragrant aroma. You cannot eat half-cooked porridge just because you are hungry; you must be patient and calmly wait for the result. Good porridge requires a slow simmer. Many people ask me what cryptocurrency to buy. I always recommend Bitcoin, but many believe that with little capital, making money from Bitcoin is difficult, so many turn to trade low-volume altcoins. I find this approach very undesirable. Why? Because these people do not understand who is determining their fate. In exchanges, the ones who hold the power are always the market makers, which is very unfair to retail investors. Because everyone, including large institutions, once they put money into the market, their fate is left to other traders. No one can control their own fate; even if your analysis is great, it is of little significance. There is only one scenario: unless you have a large amount of capital to intervene in price movement to some extent. Institutions with large amounts of capital have an advantage; they can intervene in price movements to some degree. So one of the reasons I recommend trading Bitcoin is that the market capitalization and trading volume of Bitcoin mean that there are almost no institutions capable of intervening in its price. However, for small-cap coins, it is possible that half of the holdings are in the hands of market makers. In this case, there is no fairness at all. Some people also like to pay attention to media-released news, such as predicting the rise or fall of Ethereum based on whether it can pass ETF regulations, etc. These pieces of news can convey positive or negative sentiments, but they are of no use. Because what determines the price are the traders; if traders do not perceive positivity and do not engage in actual trading operations, then no amount of positive news will matter. Many people have suffered losses from this aspect, so many prefer to short when they are bearish and go long when they are bullish.
The trap of market analysis lies in the fact that what you see is what others want you to see, and what you see is what you want to see. Whether it rises or falls, you can always find some reasonable explanation from past news. It seems logical, but in reality, it is extremely foolish. I have encountered many analysts who do not actually participate in trading; they are only responsible for content creation for trading institutions in exchange for payment, or they gather traffic and followers on social media and then make money by selling high-priced strategy membership groups. Once you understand that anyone's opinion is unrelated to the price, you basically possess the second point of the mindset: wisdom.
Nine things not to do after achieving financial freedom in the cryptocurrency space.
First, do not let those around you know that you are trading cryptocurrencies; there are many reasons for this, and those who understand will naturally understand.
Secondly, do not let others know how much money you have made. Do not show profit charts or asset charts to avoid unnecessary trouble.
Third, do not post your wealthy lifestyle on social media; besides your close relatives, no one wishes you well, and showing off can easily invite envy.
Fourth, after acquiring significant wealth, keep your distance from those you knew before. Many big players in the cryptocurrency space do this after achieving financial freedom during the bull markets of 2013, 2017, or 2021. The first thing they do is quit their jobs and never return. The second thing is to delete as many of their old acquaintances as possible.
Fifth, do not engage in gambling and drugs; gambling will destroy a person psychologically, while drugs will destroy you physiologically.
Sixth, do not insult others as foolish; value harmony, as anger affects financial luck. Stay away from toxic people who drain you, and if you encounter disagreements, simply block and delete them. Spending more time on them is a waste of time.
Seventh, do not actively do good deeds; do not pity anyone, let go of the urge to help others, and respect the fate of others. Just take care of yourself, and let everything else take its course.
Eighth, do not invest recklessly in areas you are not familiar with; one cannot earn money beyond their understanding.
Ninth, absolutely do not engage in physical entrepreneurship unless you do it for fun and not for profit. Given the current economic environment, physical entrepreneurship is a perilous endeavor.
I am currently preparing to ambush a project that will surge in the short term; doubling is not a problem. Friends interested in spot trading but lacking direction can like and comment for free sharing.
