Take a few minutes and read this article carefully, you will benefit from it for life!
01 Timing of rolling position
02 Technical Analysis
03 Position Management
04 Adjusting positions
05 Risk Management
Since the dust settled on the Fed's interest rate cut policy, the cryptocurrency market has welcomed a group of new investors who are eager for wealth and hope to find their own place in this field. However, the cryptocurrency market is not full of gold, it is more like a cruel natural selection, and only those who truly adapt to the laws of the market can gain a foothold. Although the market is open to everyone, only a few investors can really get rich returns in this field.
For those investors who are ready to step into the cryptocurrency world, they must be aware that the cryptocurrency world is not a place where you can easily realize the dream of getting rich overnight. Instead, it requires investors to conduct long-term market research, experience accumulation and continuous learning. Many people enter the market with the fantasy of getting rich quickly, hoping to get huge returns quickly with small investments. Although such success stories do exist, they often need to be achieved through a carefully planned "rolling position" strategy, which is not easy and cannot be achieved through frequent operations.
The "rolling position" strategy is feasible in theory. It requires investors to invest with appropriate positions when major opportunities appear in the market, rather than frequently making small transactions. The successful implementation of this strategy often depends on accurate judgment of market trends and grasp of timing. Although it is possible to accumulate wealth from zero to tens of millions by seizing such opportunities a few times in a lifetime, this requires investors to have extremely high market insight and decision-making ability.
In the pursuit of profit, investors should not only focus on the ultimate profit target, but should pay more attention to how to achieve these targets. This means starting from one's own actual situation, investing time and energy to deeply understand the market, rather than blindly pursuing those unrealistic huge profits. The essence of trading is to identify and seize opportunities, rather than blindly pursuing light or heavy positions.
In daily trading practice, investors can use small amounts of money to operate, thereby accumulating experience and skills. When the real big opportunity comes, they will go all out to seize the opportunity. When investors gradually grow from a small amount of principal to millions of yuan, they will unknowingly master the strategy and logic of making big money. At this time, their mentality will become more mature and stable, and future operations will be more like the replication and optimization of past successful experiences.
For investors who want to learn the rolling strategy or want to understand how to grow from a small amount of capital to a millionaire, the following content will provide valuable guidance and advice. This will be a journey full of challenges and opportunities, requiring investors to invest a lot of time and energy in in-depth research and practice.
Rolling time
The art of rolling a position is not something that can be mastered on a whim. It requires the right time, right place, and right people to increase your chances of success. Here are four golden opportunities for rolling a position:
(I) Breakthrough after a long period of sideways trading: When the market is in a sideways state for a long time and the volatility drops to a new low, once the market chooses a breakthrough direction, you can consider using rolling positions.
(II) Buying at the bottom of a bull market: In the bull market, the market experienced a strong rise and then suddenly fell. At this time, you can consider using a rolling strategy to capture the opportunity to buy at the bottom.
(III) Weekly level breakthrough: When the market breaks through the key resistance or support level on the weekly chart, it is like breaking through a solid line of defense. At this time, rolling positions can seize this breakthrough opportunity.
(iv) Market sentiment and news events: When market sentiment is as changeable as the weather, or when there are major news events and policy changes that may shake the market, rolling positions can be a powerful weapon in your hands.
Only in these specific situations do the odds of rolling a position increase significantly. Other times, it's better to err on the side of caution or simply pass on opportunities that are less clear-cut. But if market conditions seem suitable for rolling positions, don't forget to strictly control risks and set stop loss points to prevent unexpected events. After all, smart investors are always those who know how to find a balance between risk and opportunity.
Technical Analysis
After confirming that the market is suitable for rolling positions, the next step is technical analysis. First look at the trend, using tools such as moving averages, MACD, and RSI to determine whether the market is going up or down. If possible, it is best to use several indicators together, which is more reliable.
Find out the key support and resistance points of the market, determine whether the breakthrough is reliable, and use divergence signals to seize the opportunity of reversal. For example, if the price hits a new high but MACD does not keep up, this may be a top divergence, which means that the price may fall. At this time, you can consider reducing your position or shorting. Conversely, if the price hits a new low but MACD does not hit a new low, this may be a bottom divergence, which means that the price may rise. At this time, you can consider adding positions or going long.
Position Management
The key to reasonable position management lies in three steps: determining the initial position, setting the rules for increasing positions, and formulating a strategy for reducing positions. It is easier to understand by giving an example.
Initial position: If you have 1 million yuan, the initial investment amount should not exceed 10%, which is 100,000 yuan.
Rules for increasing positions: When you decide to increase your investment, you must wait until the price breaks through the key resistance level. The amount of each additional investment should not exceed 50% of the original investment, that is, a maximum of 50,000 yuan.
Scaling strategy: When the price reaches your expected profit target, you can start selling gradually. Remember, let go when it is time to let go, don't hesitate. The amount sold each time should not exceed 30% of the current holdings, so that you can gradually lock in your profits.
In fact, as ordinary investors, we can be bolder when we encounter great opportunities, and be more conservative when there are few opportunities. If we are lucky, we may make millions; if we are unlucky, we can only accept reality. However, I still want to remind everyone that once you make money, you should first withdraw the invested capital, and then use the profit to continue investing. You can not make money, but you cannot lose money.
Adjusting positions
After finishing the position management, we come to the most critical step - how to achieve rolling positions by adjusting positions.
1. Timing: Enter the market when the conditions for rolling positions are met.
2. Open a position: Follow the signals from technical analysis and find the right time to enter the market.
3. Add positions: If the market goes in your direction, then gradually add positions.
4. Reduce your position: When you have made the expected profit or something is wrong with the market, sell it slowly.
5. Close a position: When your target price is reached, or the market is clearly changing, sell everything.
How to operate specifically, let me share my experience of rolling warehouse:
1. Add more when you make money: If your investment goes up, you can consider adding more, but the premise is that the cost has come down and the risk is small. You don’t have to add every time you make money, but you have to add at the right time, such as at the breakthrough point in the trend, and then reduce it immediately after the breakthrough, or add it during the callback.
(II) Base position + T: Divide your assets into two parts, keep one part as the base position, and buy and sell the other part when the market price fluctuates. This can reduce costs and increase returns. There are several ways to divide it:
1. Half-position rolling: half of the funds are held for a long time, and the other half is bought and sold when the price fluctuates.
2. 30% bottom position: 30% of the funds are held for the long term, and the remaining 70% are bought and sold when the price fluctuates.
3. 70% bottom position: 70% of the funds are held for the long term, and the remaining 30% are bought and sold when the price fluctuates.
The purpose of doing this is to maintain a certain position while taking advantage of short-term market fluctuations to adjust costs and optimize the position.
Risk Management
Risk management, in simple terms, involves two things: total position control and capital allocation. To ensure that your total investment does not exceed the risk you can bear, you must allocate funds wisely and not put all your eggs in one basket. At the same time, you must always pay attention to market dynamics and changes in technical indicators, flexibly adjust strategies according to market conditions, and stop losses or adjust investment amounts in a timely manner when necessary.
Many people may feel excited and scared when they hear about rolling positions. They are eager to try but are also worried about the risks. In fact, the rolling position strategy itself is not very risky. The key lies in the use of leverage. If used reasonably, the risk can be completely controlled.
For example, I have 10,000 yuan in principal. When the price of a certain coin is 1,000 yuan, I open a position. I use 10 times leverage, but only use 10% of the total funds (that is, 1,000 yuan) as margin. In this way, I actually only use 1 times leverage. If I set a 2% stop loss line, once the market is unfavorable, I will only lose 2% of the 1,000 yuan, that is, 200 yuan. Even if the worst happens and the liquidation condition is triggered, you will only lose the 1,000 yuan, not all the funds. Those who have liquidated their positions often use too high leverage or have too heavy positions, and the slightest market fluctuation may trigger a liquidation. But according to this method, even if the market is unfavorable, your losses are limited. Therefore, whether you use 20 times leverage or 30 times, or even 3 times or 0.5 times, the key lies in whether you can use leverage reasonably and control your positions.
The above is the basic operation process of rolling position. Friends who are interested can read more and study it carefully. Of course, everyone may have different opinions. I am just sharing my experience and not trying to convince anyone.
How to grow small capital? Compound interest effect.
If you have a coin and its value doubles every day, after a month, its value will be much higher. Double it on the first day, double it again on the second day, and so on, and the final number will be astonishingly large. This is the magic of compound interest. Even if you don't have much money at the beginning, as long as you keep doubling it, you will eventually accumulate to an astonishing number.
For those who don't have much money but want to enter the market, aim for big goals. Many people think that small funds should be traded frequently in the short term to increase value quickly, but in fact, the medium and long term may be more suitable. Instead of making a little money every day, it is better to focus on how many times the growth can be achieved in each transaction. What we want is multiple growth, an exponential leap.
In terms of position management, you should first diversify your risks and not put all your funds on one transaction. You can divide your funds into three or four parts and only invest one of them at a time. For example, if you have 40,000 yuan, divide it into four parts and only use 10,000 yuan for each transaction.
Use leverage appropriately. The leverage for mainstream currencies should not exceed 10 times, and for small currencies should not exceed 4 times.
Make adjustments dynamically. If you lose money, replenish the same amount of funds from outside; if you make money, withdraw some appropriately. In any case, don't let yourself fall into losses.
When your funds grow to a certain level, you can consider gradually increasing the amount of each transaction, but don't add too much at once; do it step by step.
Through reasonable position management and a sound trading strategy, small funds can gradually achieve substantial appreciation. The key is to wait patiently for the right time and focus on the big goal of each transaction rather than the small profits every day.
I also know that margin calls can happen to anyone. But I still had spot profits to make up for the losses. I don’t believe that you didn’t make any money from the spot. My futures only account for 2% of the total funds. No matter how much I lose, I won’t lose it all. The amount of loss is always within my control.
