Comprehensive Analysis of Bitcoin Market Volatility: Secrets of Trading and Short-term Techniques Revealed

In the world of Bitcoin investment, to make a profit, one must remember three major rules; a slight misstep may lead to deep losses.

First, chasing highs and cutting losses is a big taboo. When prices soar and everyone rushes in, do not blindly follow the trend to buy. It is crucial to understand that investing requires contrarian thinking; when others are fearful, one should act decisively, and when others are fervent, one must remain calm. Conversely, when prices are falling, it often presents a good buying opportunity.

Second, never go all in. Betting all funds on a single order is undoubtedly a gamble with extremely high risks. A wise action is to reserve some funds, leaving room for oneself to cope with market uncertainties.

Third, always avoid full position trading. The market changes rapidly, with opportunities constantly arising; being fully invested means placing oneself in a passive position, foregoing other potential high-quality opportunities, and incurs great costs, which is not a cost-effective approach.

In addition to the above rules, there are many small tips worth noting for short-term trading.

When prices are at a high, there is often an inertia to push higher; conversely, at low levels, there may be further declines. Therefore, it is essential to patiently wait for the situation to clarify and not make hasty decisions.

When prices are consolidating, impulsive trading is most to be avoided. Many losing traders act rashly out of impatience. Observe the K-line chart; if the daily line closes bearish, it may be a heavenly opportunity to buy; if it closes bullish, one should consider taking profits.

The rate of decline and the speed of rebounds also follow certain patterns. If the decline is slow, the rebound will also be delayed; if the decline is rapid, the rebound may arrive quickly.

The process of building positions should be like constructing a pyramid, step by step; this is the unchanging principle of value investing.

Whether it’s a continuously rising or falling currency, it will eventually face a consolidation period. At this time, one must not hastily enter or exit with a full position, as the trend may reverse after consolidation. If the direction is downwards, timely stop-loss and exit are necessary; if the direction is upwards, one should decisively increase positions and follow up.

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