Article Reprint Source: Shenchao TechFlow
Author: Game
Translation: Shenchao TechFlow
Fear of 'this is the last cycle' + uncertainty about how long good times can last + social pressure from others performing better. These three factors create a deadly combination that destroys many people's decision-making ability.
Possible Consequences:
Distraction: Blindly chasing every hot trend while neglecting the necessity of focusing on critical trades.
Pessimism and Hesitation: Losing confidence due to uncertainty, leading to an inability to hold any asset long-term, or even completely withdrawing from the market.
Lack of Belief: Insufficient in-depth research on projects, failing to establish enough confidence to cope with market fluctuations.
Lack of Profit Strategy: Fear of market endings leads to hasty liquidation at slight Bitcoin pullbacks, missing out on larger profit opportunities.
Response Suggestions:
Focus on Key Areas:
Focus on one or two specific areas or hot narratives within the chain.
Make a Clear Choice: On-chain trading or secondary trading, focus on one direction.
If you think you can dabble in all areas at once, you are only fooling yourself. Concentrate your resources and energy on the areas that align best with current market conditions and can yield the highest returns. Combine your capital scale, advantages, and market environment to find the direction and strategy that suit you best.
Clarify Your Operation Method:
Understand whether you are investing, trading, or speculating—there are essential differences among the three, and do not confuse them.
A simple judgment framework can help you distinguish between these approaches and formulate corresponding strategies.
Stick to Your Plan:
Develop a Clear Action Plan, including the following elements:
Market Cap Range: Determine which market cap range you will enter.
Profit Plan: Establish rules for taking profits in batches, instead of liquidating everything at once out of fear.
Target Estimation: Set target prices your assets may reach, along with the time frame for achieving these targets.
Stop-Loss Conditions: Clearly define when to partially or completely stop-loss, which can be based on changes in fundamentals or technicals, or adjusted due to changes in the macroeconomic environment (such as upcoming important data). For example, in uncertain macro conditions, it may be wise to take profits and wait for lower prices to re-enter.
Know Yourself:
Identify Your Weaknesses: Do you lack experience? Is there insufficient technical ability? Is there excessive optimism or pessimism? Is there improper capital management or a lack of time?
If you find that your weaknesses in these areas are greater than others, decisively abandon competition in this field. Choose directions where you have advantages and focus on your strengths.
Continuous Improvement
Reflect seriously after each trade—what actions were successful, which were failures, and why? Was the issue in the process or decision-making, or was the decision itself reasonable but the outcome disappointing?
Your goal is: continuously reduce errors in your operations, gradually improve your win rate through experience accumulation, and appropriately increase your position when the hit rate is higher.
If you neglect this process, you are likely to fall into a long-term cycle of indecision, making it difficult to achieve real progress both psychologically and in performance.
Don't Go It Alone
In the market, reliable partners are crucial. They not only hold you accountable for your actions but also help you cover your shortcomings.
Truly quality trading opportunities often come from mutual support within a team—where you cover their weaknesses, and they help you improve.
Quality Over Quantity: The number of partners is not necessarily better. What you need are those trustworthy traders with a high hit rate, who are on par with you or even better in the areas you focus on.
Broaden Your Horizons: Create a small circle different from your main area, where people can provide you with important information on macro trends, market cycles, and other insights beyond your immediate focus. These insights will ultimately feed back into your overall market understanding, helping you develop better strategies.
