I’ve been in the crypto space for many years, witnessing too many people who made a fortune only to lose it all. Why does this happen? It's because they haven't mastered the core principles. Today, I will share 5 practical experiences, all of which are lessons learned with real money!
One, when it rises fast and falls slowly, the market makers are accumulating! Don’t easily cut losses and exit. Market makers often use a slow decline to shake out retail investors.
Many newcomers panic when they see the coin price drop. In fact, if you observe carefully, if it rises like a rocket but falls like a snail, and after a while it goes sideways with moderate trading volume, this situation is likely to be accumulation!
Why? Because big players and institutions are not stupid; to build positions, they need to make retail investors let go. Rapid rises are to entice retail investors to chase high, while slow declines are to avoid letting retail investors notice they're buying in stealthily at the bottom. Once retail investors feel it's pointless and exit, their chips are collected enough, and the next wave of the market is about to come! Once they have accumulated enough chips and the washout is over, the upward trend begins.
Two, when it drops fast and rises slowly, it's definitely time to sell! At this point, we need to decisively exit.
This situation is exactly the opposite: the decline is as sharp as a cliff, while the rise is like an old cow pulling a cart, only rising a little before starting to sideways, occasionally increasing trading volume. When you see this, be cautious! This is the market maker using every bounce to sell off their holdings. They won't sell everything at once but will use each small rebound to gradually disperse their chips to retail investors.
Three, don't rush to flee when there is volume at the top; if there's no volume, withdraw quickly!
This experience is particularly valuable. Many people want to sell when they see new highs; in fact, you should look at the trading volume. When there is volume at the top, it indicates strong market interest, new funds are still entering, and the upward momentum remains strong; the market may not be over yet. Further observation is needed.
But it’s different when there is no volume at the top. Market enthusiasm is waning, buying power is diminishing, and the upward momentum is insufficient; this is a signal to withdraw.
Four, don't rush to buy when there is volume at the bottom; wait for sustained volume before entering!
This principle is similar to the top. When there is a lot of volume at the bottom, it often isn't a true bottom; it could be a big player liquidating, panic selling, or resistance during a downturn.
However, if trading volume can continue to expand, then it's different. This indicates that the bulls are accumulating power, new funds are continuously entering, and market confidence is recovering; this is the best time to build positions.
Five, the most important truth: trading cryptocurrency is about trading emotions; consensus is the hard truth! You must have a long-term mindset!
What is the biggest secret in the cryptocurrency world? It's not technology, it's not applications, but human nature! When market sentiment is good, even junk coins can skyrocket; when market sentiment is poor, good projects also have to bow down.
And what best reflects market sentiment? It's trading volume! A continuous shrink in volume indicates a loss of interest; a continuous increase in volume indicates a consensus is forming. Remember: any market movement without trading volume is illusory. No matter how good the project is, it's useless if no one trades it.
These principles are not universal, but if you grasp the rhythm, the difference can be significant. Opportunities in the cryptocurrency market are fleeting; it all depends on whether you can seize them!
Finally, be sure to position yourself with high-quality strong currencies. Buy the leading sectors, lay low after buying, and avoid frequent trading. It is recommended to gradually exit after doubling your investment! Additionally, keep a large portion of your assets for medium to long-term holding, so you can achieve significant results in this bull market!
