In this field of opportunities and risks, some have achieved financial freedom while others have lost all they invested. As a mentor in the market said, the secret to trading is to keep it simple, mastering one method to perfection is the way to survive and profit.
Two years ago, I met this mentor in Shanghai. With the simplest method, he has steadily gained tens of millions in returns from the market. He emphasizes that "the way is simple" and warns us that complex thinking and excessive worry can hinder our ability to make accurate judgments, while those who suffer losses often get entangled in such confusion.
Here are a few classic phrases he shared at that time, which may seem plain but contain profound market wisdom. As long as you master these key points, achieving huge profits is not difficult; at the very least, making small profits is not a challenge. Here is the content shared by this mentor; let's deeply understand and apply it at the right time.
1. Observe after high and low consolidations.
When the market is in a high or low sideways consolidation phase, staying on the sidelines is a more cautious strategy. The appearance of sideways movement often heralds a trend change; after digesting previous fluctuations, the market will ultimately choose a clear direction. At this time, acting rashly may lead to unnecessary losses. It is wise to wait for the market to clarify before following the trend. Mentors have repeatedly reminded us, "During sideways movement, being observant is more valuable than trading blindly." 2. Do not cling to hot positions; adjust positions according to the market. In short-term operations, hot positions are often the result of speculation. Once the heat dissipates, funds will quickly exit, leaving investors stuck in a passive situation. Therefore, mentors advise not to linger too long on hot positions but to adjust flexibly and maintain maneuverability.
As he said, "Short-term hot positions come quickly and leave quickly; a slight misstep can lead to chasing highs and cutting losses. Successful short-term trading is not about blindly following trends but about staying clear-headed and achieving "starting to finishing, only to end up empty.
3. In an uptrend, gaps should open high, and positions should be held firmly.
If, in an uptrend, a bullish candle appears with a gap up and increased volume, it indicates that the market has entered an accelerated rising phase.
At this point, one should remain calm and hold positions firmly, as this situation often leads to a significant rise. The mentor refers to this as the "growth phase," emphasizing the need to maintain strong belief during this stage and not be influenced by short-term fluctuations, which can lead to substantial profits.
4. A large bullish candle requires decisive exit.
Whether the market is at a high or low, the appearance of a large bullish candle is always a signal to exit. In this case, even if you see a limit-up, you should decisively exit, as a pullback often follows a large bullish candle. The mentor tells us, "No matter how tempting the profit, take the opportunity to close the position, as in most cases, taking profit decisively is key to avoiding profit retracement." The core of this strategy is to "know when to enter and exit"; one must always guard against risks and control profit withdrawals.
5. Buy on upward moving averages and sell on downward moving averages.
Moving averages are one of the key references for short-term operations. If the stock price is above important moving averages and a bearish candle retracement occurs, this is a suitable buying signal; conversely, a bullish candle below the moving average may indicate weakening upward momentum, suitable for selling and exiting. In short-term investing, generally focus only on daily moving averages or attack lines, avoiding prolonged holding, as it increases risk. The mentor reminds us, "Not more than a week, act within three days; don't linger over missed opportunities." Short-term trading emphasizes speed and precision; holding for too long increases risk.
6. Do not sell on highs, do not buy on dips, do not move during sideways.
In the cryptocurrency market, where price fluctuations are frequent, this principle is considered a basic survival rule. If the current price is not significantly above the buying price, do not easily sell; conversely, if there is no significant drop, do not rush to buy. When the market is sideways, it is safer to observe. The mentor calls this "stability is paramount," as any rash trading can lead to losses. Long-term profits rely not on frequent entry and exit, but on reasonable timing for entering and exiting.
7. Enter less, avoid excessive investments, and act within your means.
In the cryptocurrency circle, maintaining flexibility is key. Even with great confidence, it is not advisable to invest a large sum all at once; reasonable position allocation is crucial. The mentor reminds us, "It's better to enter less than to be greedy," as unexpected market fluctuations can occur at any time, and spreading funds can reduce the risk of any single investment. For each trade, a reasonable position ratio should be set to avoid being caught off guard during sudden market movements.
8. Learn to interpret market news.
In the cryptocurrency circle, the influence of news should not be underestimated. Market news often directly triggers significant price fluctuations, which can lead to sharp rises or drops, so investors should learn to interpret market information, especially significant events and policies. The mentor advises that beginners should primarily observe during major news events, as excessive intervention may lead to unnecessary losses.
9. Master technical indicator analysis.
Technical analysis plays an important role in the cryptocurrency circle. The mentor suggests that beginners should systematically learn technical indicators, develop a learning plan, and master analysis tools such as moving averages, KDJ+, Bollinger Bands+, candlestick patterns, volume-price relationships, and capital flows. Technical analysis requires long-term accumulation and is not something that can be achieved overnight. Mastering technical analysis can help investors judge buying and selling points, reducing unnecessary losses.
10. Formulate a trading plan to avoid frequent trading.
Frequent trading not only incurs high fees but also disrupts trading mindset, leading to emotional decision-making. The mentor emphasizes, "Trading requires planning and should not be done blindly." In the cryptocurrency circle, frequent entries and exits often mean greater uncertainty. An effective trading plan can help investors maintain rationality and a clear mindset.
11. Implement risk control and set stop-loss and take-profit levels.
Before each trade, set reasonable stop-loss and take-profit points to control risk within an acceptable range. When reaching stop-loss or take-profit points, one should exit decisively rather than greedily pursuing more profit. Given the significant price fluctuations, mentors' experiences tell us, "Reasonable stop-loss and take-profit are the keys to successful trading." Even experienced investors cannot accurately predict the market, so solid risk control measures are a must for every investor.
Summary: Trading cryptocurrencies is not something that can be achieved overnight, nor can it be sustained through luck or following trends. Mentors' experiences tell us that success lies in rationality and patience. The key is to find a method that suits oneself, adhere to principles, and practice repeatedly, rather than chasing fleeting trends or quick profits. Stable profits come from maintaining a balanced mindset, controlling risks, and having a deep understanding of the market.
Mentors teach us: "Less is more, simplicity is essence." In the market, excessive trading and frequent judgments can weaken profit opportunities. Investors must remain calm in the face of the market and truly grasp the essence of the "way" to navigate the ever-changing cryptocurrency landscape with ease. Let us encourage each other.
Timing is more important than effort, as the saying goes, when the time comes, all forces unite, when luck departs, heroes are not free. The core of cryptocurrency lies in the news, accurate news! Only high-quality primary signal sources can ensure a position in the market.
These days, I am preparing for the upcoming strategic layout!!!
Comment 168 to get in!!!
Impermanence brings impermanence brings impermanence!!!
Important things should be said three times!!!
