From Setbacks to Triumph: My Journey to a Proven Crypto Trading System
For nearly a decade, I’ve been immersed in the trading world. The beginning, however, was far from smooth. In my first three years, I invested 1.2 million yuan into the stock market, only to see my balance dwindle to just 100,000 yuan due to a lack of strategy and direction. The ridicule I faced from friends and family was harsh—they labeled me reckless and naïve. Their criticism made me question my abilities, but instead of surrendering to failure, I resolved to turn things around. I promised my partner that I’d make one last attempt, but this time, with discipline and a calculated approach.
I devoted months to studying charts, reflecting on my mistakes, and designing a trading system tailored to my style. The result? I turned that remaining 100,000 yuan into an astonishing 30 million yuan within three years. This wasn’t sheer luck; it was the outcome of persistence, disciplined execution, and a deep understanding of the markets. Below, I’m sharing the strategies and principles I used so you can learn and adapt them for your own success.
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Core Trading Principles for Every Trader
Whether you're a novice or experienced, these principles form the foundation of a successful trading approach:
1. Master Market Sentiment
Understanding the emotions driving the market is crucial. Pay close attention to volume and price action:
If trading volume spikes but prices stop falling, it often signals the end of a decline.
If high volume coincides with stagnating price growth, a bullish trend may be losing momentum.
During uptrends: A gradual increase in volume supports a steady rise. However, sharp volume spikes may signal an impending reversal.
During downtrends: Breaking key support levels with increasing volume confirms further downside movement.
2. Identify Key Price Levels
Use technical tools to spot resistance, support, and trend lines:
Incorporate Fibonacci retracement to identify significant levels.
Be prepared to act decisively when prices test or break these critical points.
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Choosing the Right Timeframes
Each timeframe serves a distinct purpose in your trading strategy:
1-Minute Chart: Perfect for pinpointing precise entry and exit points.
5-Minute Chart: Ideal for tracking short-term movements during trades.
1-Hour Chart: Provides a clear view of overall market trends and direction.
Pro Tip: If a trade turns against you, don’t chase your losses. Accept the setback, recalibrate your mindset, and approach the next trade with fresh focus.
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A Beginner-Friendly Trading Method
This simplified yet powerful strategy is effective for traders of all levels—provided you stick to it with discipline. Here’s the breakdown:
1. Use Moving Averages as Your Guide
Set up your chart with the following moving averages:
6-day moving average: Reflects short-term price trends.
20-day moving average: Captures medium-term trends.
40-day moving average: Acts as a major support or resistance level.
2. Smart Capital Allocation
Divide your trading capital into three equal parts:
Phase 1: Enter with 33% of your capital when the price breaks above the 6-day moving average.
Phase 2: Add another 33% when the price crosses the 20-day moving average.
Phase 3: Invest the final 33% if the price moves above the 40-day moving average.
3. Exit at the Right Time
Protect your capital by following these rules:
Sell the first position if the price drops below the 6-day moving average.
Exit the second position if the price dips below the 20-day moving average.
Close all positions if the price falls beneath all three moving averages.
4. Reentry Opportunities
If the price recovers and moves back above the 6-day or 20-day average, you can reenter using the same phased allocation.
5. Taking Profits at Peaks
Use the reverse approach to lock in profits:
Sell 33% when the price drops below the 6-day moving average during a decline.
Hold the remaining portions until the 20-day and 40-day averages are breached.
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Discipline Is Your Secret Weapon
The simplicity of this strategy belies its effectiveness. The real challenge lies in adhering to the rules without letting emotions cloud your judgment. Ignoring stop-losses or making impulsive decisions can quickly lead to avoidable losses. Stay focused, stick to the plan, and you’ll see consistent results over time.
This method didn’t just change my trading—it transformed my life. While no strategy can promise success in every trade, these principles will provide a solid framework to navigate the market confidently and mitigate risks.