I once heard a story about a friend who used to work in the taxi industry. Later, he entered the cryptocurrency circle and spent a lot of energy studying the methods of cryptocurrency trading. It is said that through a set of methods he summarized, his asset status has changed a lot, and now his assets have exceeded eight figures. Let's briefly analyze the key steps of the method he used.
Step 1: Choose a currency
When he was choosing currencies, he was used to opening the daily chart and focusing on currencies with MACD golden crosses, especially those with golden crosses above the 0 axis. He believed that based on past experience, the probability of such currencies showing an ideal trend was relatively higher.
Step 2: Set up trading basis
He mainly uses the daily chart as a reference, and only locks in one daily moving average (MA) as the basis for buying and selling decisions. The operating rule is to choose to hold when the currency price remains on this MA, and once the currency price falls below this line, he will consider selling.
Step 3: Buying and adding positions strategy
After the actual purchase operation, if he sees that the price of the currency has successfully broken through the daily average line, and at the same time the trading volume can also stand on the daily average line synchronously, he will choose to buy all positions. In the selling stage, there is a relatively clear three-step strategy:
1. When the price rises by more than 40%, he will sell 1/3 of his position to cash in part of the profit.
2. When the increase reaches 80%, then sell 1/3 of the position.
3. Finally, when the price of the currency falls below the daily average, all remaining positions will be liquidated.
Step 4: Strictly stop loss and avoid risks
Throughout the process, he particularly emphasized the importance of stop loss, believing that this is a critical point. For example, if the price suddenly falls below the daily average the next day, you must sell all of it without hesitation, and never take chances. Although according to the coin selection logic he summarized, the probability of the price falling below the daily average is relatively small, risk prevention and control must be in place. If the price subsequently returns to above the daily average, he will consider buying again based on the actual situation.
However, this is just an individual case. Cryptocurrency investment is affected by many complex factors and the market is unpredictable. We cannot blindly follow suit based on this one case. Investment decisions must still carefully weigh the pros and cons.
