Prices do not say they have peaked, and declines do not say they have bottomed.
Market trends often exceed the imagination of most people. Take Bitcoin for example; many people did not believe it could reach such a high of $150,000 when the price was gradually climbing. They were limited by their inherent perceptions, thinking the price had already risen to an absurd level and could not go up any further. However, they overlooked the market's crazy power, and once a bull market arrives, the potential for price increases is difficult to measure.
Similarly, during the decline, people often misjudge. When Bitcoin was at $68,000, many investors thought that was the bottom and rushed to buy. However, the market mercilessly continued to plunge, and when it dropped to $62,000, these investors began to panic.
What is even more unexpected is that the price has also experienced a spike, directly reaching $56,000. This situation has caused heavy losses for those investors who blindly speculated on the bottom. It’s like someone groping in the dark, thinking they have found a safe landing spot, only to realize that they are standing on a deeper abyss. This tells us that we should not make subjective assumptions to guess the top and bottom of the market, because market changes are endless and will not operate according to our expectations. Each trade should ideally not exceed 5% in one go to achieve high returns, yet this approach often backfires. True experts build their positions in batches according to a ratio of about five percent.
In crypto investing, capital management is crucial. Especially for investors with small amounts of capital, they often feel the need to go all in. For example, an investor with $1 million might only invest $50,000 each time they build a position. The benefits of this approach are obvious. First, it greatly increases the chances of trial and error. If the market trend goes against expectations after the first position build, the loss is only 5% of the total capital, leaving enough funds for subsequent operations.
If a large amount of money is invested all at once and a judgment error occurs, it could lead to heavy losses, or even complete loss of capital. Additionally, this method of building positions in batches allows for continuous cost optimization. As market prices fluctuate, subsequent positions may be acquired at lower prices, thereby reducing overall costs. It's like building with blocks, piece by piece, gradually constructing a stable investment portfolio.
Fear of heights is the fate of the unfortunate.
In the crypto world, every currency has major players operating behind it. The costs incurred by these major players to promote a currency’s development are extremely high. From early promotional expenses to acquiring chips, as well as developing related technologies and applications, these add up to a huge sum. This is not a simple 20%-50% cost ratio; it could be several times or even dozens of times higher than we imagine.
For some emerging currencies, to stand out in a competitive market, they need to conduct large-scale promotion globally, and the advertising costs, salaries for marketing personnel, etc., are not insignificant expenses.
At the same time, to acquire enough chips to control price trends, major players may need to buy large amounts in the market, further increasing costs. Therefore, when we see a currency's price continuously rising, we should not shy away just because the price is high. Because behind this price is solid value support; major players need higher prices to make a profit, which provides us, the investors, an opportunity to follow and profit.
A bull market is the only opportunity for a turnaround.
The legendary figure in the investment world, Warren Buffett, bases his investment strategy largely on long-term value investing and relies on the relatively stable market environment of the US stock market. However, even investment masters like Buffett must face losses if they encounter a bear market. He chooses to stay long in the US stock market and remain in Omaha because the market environment there suits his investment style. In the crypto world, the situation is even more complex and extreme. In a bear market, almost all currencies are falling, market sentiment is extremely pessimistic, and investors find it very difficult to profit. Conversely, a bull market is completely different; in a bull market, massive funds pour into the crypto world, and prices of various currencies soar. Like a tide, the power of a bull market can lift all boats. At this point, investors only need to choose relatively high-quality currencies to have a great chance of significantly increasing their assets. Therefore, for crypto investors, seizing the opportunity in a bull market is the key to achieving a turnaround.
The lagging nature of technical indicators.
Technical indicators are tools that many investors rely on in crypto investing, but we must clearly recognize their limitations. Technical indicators are often based on historical data for calculation and generation, which leads to their lagging nature. For instance, when the price is strongly rising, we find some commonly used technical indicators, such as MACD, also showing a positive trend. But at this time, the price has actually risen very high. Many investors see the positive signals from technical indicators and blindly chase the price, often ending up trapped at high positions. Take the MACD indicator, for example; it often shows a golden cross one day, leading investors to believe an upward trend is coming, only for it to turn into a death cross the next day, with the market trend plummeting. Such situations are common, indicating that we cannot rely solely on technical indicators as the main basis for buying and selling; rather, we should use them as a reference, combined with analysis of market fundamentals, capital flows, and other factors to make more reasonable investment decisions.
Firmly believe that one will eventually conquer the market.
In the challenging field of cryptocurrency, confidence is the key to success. Every successful figure in the crypto world possesses a strong self-confidence. Their investment journeys have not been smooth, and they have all experienced losses. However, they have never been defeated by these setbacks. They trust their judgment, believe in their understanding of the market, and consistently adhere to their investment strategies. Like travelers in the dark, they have a guiding light in their hearts, which is their confidence in themselves. If an investor does not believe they can make money in the crypto world, they are likely to waver and make wrong decisions when faced with market fluctuations and various complex situations. This confidence is not blind arrogance but is built on in-depth learning of market rules, continuous improvement of one's investment strategy, and summarizing past experiences. I would like to share my recent experiences and insights using just one strategy: the Volume Analysis Strategy - EMV Indicator. At the end of last year, I entered the crypto world with $200,000, only with a try-it-out mindset. I did not blindly follow the trend but instead studied the EMV indicator in depth. When the price was at the market top, I noticed a very obvious phenomenon: once there was a large trading volume, the EMV value would react in advance. It began to decline and gradually approached the zero axis.
This process is like the calm before a storm; on the surface, the market may still be bustling with trades, but danger is quietly approaching. When the EMV value turns from positive to negative, it is a clear signal that the trend is about to reverse and enter a downward trend. Based on this signal, I decisively sold the currencies I held. It is precisely through the precise application of this indicator that my assets have grown like a snowball. For the next layout direction, I will lead everyone to aim for the lucrative opportunities in altcoins, especially those with great potential, where an expected return of over ten times is not a problem. If you want to make big money in a bull market, like and comment, and I'll take you to layout the entire bull market together.
