Written by: David G, Moonshot Consultant
Compiled by: Yuliya, PANews
This article is a practical guide on how to profit in a cryptocurrency bull market and avoid risks. It elaborates on trading strategies and risk management methods from three core dimensions: portfolio structure, leverage usage, and on-chain trading.
I. Portfolio Structure
The construction of a portfolio needs to be adjusted based on the scale of funds, but there are several core principles that must be followed:
High-quality collateral as the main focus
It is recommended to focus on high-quality assets such as BTC and SOL;
Switch to stablecoins during volatile or bear markets;
In a bull market, use profits to supplement holdings of mainstream coins;
Dynamic adjustment strategies
Currently maintaining close to 100% allocation in BTC and SOL;
Gradually increase the proportion of stablecoins as the bull market cycle progresses;
II. Leverage Usage Guide (Advice for Beginners)
Set aside traditional perceptions of leverage from social media, and view leverage as a tool to improve fund efficiency.
Treat differently
Leverage strategies for mainstream coins and low market cap coins should be completely separated;
Using leverage on SOL and using leverage on a token with a market cap of 500M are entirely different trades;
Basic Principles
Total leverage for low market cap coins should not exceed 1x (for example: $100,000 SOL as margin, altcoin longs should not exceed $100,000);
Mainstream coins can use 2-5x leverage at specific times;
The higher the leverage multiple, the earlier the profit-taking should be;
Never make trades that risk your entire fortune; always leave yourself an escape route;
III. On-chain Trading Strategies
Pursue excess returns
Focus on opportunities that could yield significant returns rather than daily profits;
Do not overly pursue the accumulation of small transaction profits (as Warren Buffett said, diversification is the protection of the ignorant.);
Position Management
Avoid full position trading;
Adopt a tiered reduction strategy;
For example: sell 10% at 50M, then another 10% at 100M, and so on;
Risk Control
Volatility management
Be mentally prepared for a 50-70% pullback;
View volatility as an opportunity rather than a threat;
Maintain emotional stability and avoid panic decisions;
Summary
Successful trading relies more on psychological factors; the biggest opponent is oneself. Through reasonable portfolio allocation, cautious leverage usage, and correct on-chain trading strategies, one can achieve considerable profits in a bull market while effectively controlling risks. Remember: volatility is an important source of profit in the cryptocurrency market, and learning to coexist with it is the key to success.
