When the initial capital is not large, for example, less than 100,000, it is enough to catch a big fluctuation every day. Because the amount of capital limits the ability to resist risks, if you are greedy and hold positions all the time, once the market reverses, you may lose everything. Like some small investors, who frequently operate and hold positions overnight, encounter a sudden market plunge, the meager profits will disappear in an instant, and even the principal will suffer a heavy loss.
When major good news comes, if you don’t ship on the same day, you must sell it when it opens higher the next day. Many examples show that once good news is realized, there is often a lack of upward momentum and it enters a downward channel. For example, a new currency released major cooperation news, and the price rose sharply on the first day. Many people expected a higher increase and did not leave the market. After opening higher on the second day, it fell all the way.
The impact of news and holidays on market trends is significant. Before major events, such as policy adjustments or large conferences, it is wise to reduce or clear positions in advance. Historical data shows that during these times, market fluctuations are enormous and direction is hard to predict. Instead of holding positions blindly, it is better to wait for clarity in the market and then act accordingly, which can effectively reduce risks and increase the likelihood of profits.
For medium to long-term investment strategies, one should enter the market with a light position and reserve enough operational space. Heavy positions are like walking on the edge of a cliff; if the market trend does not align with expectations, the resulting losses can be unbearable. A light position allows investors more opportunities to adjust in response to market fluctuations, enabling steady progress in the cryptocurrency space over the long term.
Short-term trading emphasizes following the trend and quick entry and exit. During significant market fluctuations, accurately capturing the right entry points is crucial; if the market is inactive, one must patiently hold a cash position and wait. Hesitation and greed often lead to missing the best exit opportunities, turning profits into losses. For example, in a rapidly rising market, failing to take profits in time can result in a sudden downturn, erasing previous gains.
It is also essential to remember the characteristics of market fluctuations; slow fluctuations lead to slow rebounds, while rapid fluctuations yield quick corrections. Based on this rule, investors can better grasp buying and selling opportunities. If one rashly tries to catch a falling knife during a rapid correction, they may end up buying in the middle of a downward trend.
After entering a position incorrectly, timely loss-cutting is crucial. Cutting losses is not about losing money but rather preserving capital at a small cost to create opportunities for subsequent profits. In the market, capital is the foundation for survival; only with a solid foundation can one withstand the storms of the cryptocurrency world.
When trading short-term, the 15-minute candlestick chart combined with the KDJ indicator can help capture entry points. By analyzing signals such as the overbought and oversold areas of the KDJ indicator, one can more accurately assess short-term market trends and improve the success rate of trades.
On this complex and ever-changing journey of cryptocurrency trading, there are many techniques and methods, but mindset is the core. The significant ups and downs in the cryptocurrency market can easily affect investor emotions, leading to impulsive decisions. Only by remaining calm and rational, and not succumbing to greed and fear, can one navigate this landscape effectively.