Everyone, take a look at my tearful self-reflection after losing 1 million: I realized one thing: there is only one type of person who can get rich trading cryptocurrencies!
In the cryptocurrency world, one day is equivalent to a year in the stock market. Those who engage in cryptocurrency trading will no longer have any interest in stock trading. The all-day trading and unrestricted price fluctuations in cryptocurrency fulfill many people's dreams of overnight wealth, which is one of the reasons it is so popular. This also makes losses in cryptocurrency trading a common occurrence.
Every investor who enters the cryptocurrency market will experience significant losses, liquidation, and transitions from profits to losses. In the army of cryptocurrency traders, only one type of person can get rich: those who have experienced bankruptcy and then reflect and learn with a great mindset.
Without experiencing liquidation and significant losses, one can never truly understand what a stop-loss is; without experiencing profits turning into losses, one cannot appreciate the shift from heaven to hell in mindset.
Survival is the first principle.
As Sun Tzu said: 'The good warrior of the past prepares to be invincible and waits for the enemy to be vulnerable.' It is very simple to avoid significant losses; survival is the first principle. When there is a danger that disrupts this principle, abandon all other principles. Because no matter how many 100% excellent performances you have had in the past, as long as you lose 100% now, you have nothing left.
Once your funds are wiped out, you are destined to be eliminated. To excel in this game and achieve ultimate victory, all systems and rules must prioritize preserving principal.
Proper capital management: Each success only brings you a small step forward, but one failure can set you back significantly. This setback hinders the accumulation of capital, which requires both opportunity and time. Human nature is such that the pain of losing 1,000 yuan far outweighs the joy of gaining 1,000 yuan. A large loss can easily affect an investor's mindset. Losing 50% on 1 million becomes 500,000; making 100% profit to recover from 500,000 to 1 million is necessary. It takes an hour to walk from the first floor of the Empire State Building to the top, but it only takes 30 seconds to jump from the roof to the ground. You cannot control market direction, so do not waste energy and emotions on things you cannot control. Do not worry about how the market will change; worry about what strategies you will use to respond to market changes. Judging right from wrong is not important; what matters is how much profit you make when you are right and how much loss you can bear when you are wrong.
Every time I see people in the market haggling over the price of an item for a long time, or shopping for half a day, yet investors do not spend more than a few minutes thinking about their buying decisions, this is a commonality among many people. This is not the behavior of someone who wants to make a big move in the investment market. To earn big money in the market, investors must be cautious and protect their accounts as if walking on thin ice.
Have a clear operational system when entering the market.
(1) Prepare how much money to earn in this market wave.
(2) How much loss can I accept at most? If the market retraces, how much loss must I exit immediately?
(3) I must secure a fraction of the profit every time I operate.
(4) Gradually increasing positions to avoid full position trading, continuously raising profit stop-loss levels as profits rise, never allowing profits to turn into losses.
(5) Always give yourself a chance to trade again and strictly follow your trading system.
Trend is the best friend.
The biggest enemy of trading is the patience to wait for a clear market trend and overtrading. Bull markets do not end in a day, nor do bear markets. Cryptocurrency trading is the place I've seen where one can stay dormant for three years and then profit for three years. As long as you have patience and wait for a clear market trend, find the leading stocks, and hold on until the end of the bull market without over-trading, you can achieve unexpected profits. When a trend arrives, respond accordingly. In the absence of a trend, observe and remain calm.
Overtrading is also a major enemy of investment. Those who trade on price differences can only earn a small profit but cannot make big money. Let's calculate the transaction fees from excessive trading: Current virtual currency exchanges charge 0.2% for buying and selling each transaction, meaning the total cost for one transaction is 0.4%. If a trader operates once a day, for a year with 365 days, this trader loses 4/1000 * 365 = 140% due to transaction fees. You may not realize it, but that’s 1.4 times. Think about it—Warren Buffett strives for 30%, and what about you? Your annual trading fees amount to 140%! Another trader often overlooks this: the more frequently one enters and exits the market, the more likely they are to change their mind frequently. As the saying goes, 'The more you do, the more mistakes you make; the less you do, the fewer mistakes you make; and not doing at all means no mistakes,' but excessive trading can lead to missing out on significant market movements.
Plan before taking action: Based on obvious price breakpoints, market sentiment, trading conditions, and capital inflow, determine the onset of trends. Maintain a broad vision of market trends and do not be misled by short-term fluctuations.
Psychological quality is the core.
Trading is against human nature; it’s a game that only a few can profit from, while most merely provide capital to play. In trading, one needs to have strong psychological quality and a mindset that can handle the risk of liquidation. If you enter the market with 10,000 yuan and your heart races over fluctuations of 100 yuan, then I advise you to leave the market early for your own safety. If you have the mindset of wanting to earn 100 million, then fluctuations within 1 million will not affect your mindset because your ultimate goal is 100 million, and 1 million is not in your consideration range. Only then can you seize the opportunity for significant profits.
Trading is not just a game against large institutions, market makers, and retail investors, but also a game against oneself. As the ancients said: 'Fighting against heaven is joyful; fighting against earth is joyful; the highest state of struggle is to fight against oneself.' Trading is a continuous psychological struggle, constantly questioning oneself whether to sell or hold at a certain price, and what to do—this is a psychological game that requires strong mental quality. Additionally, maintaining physical health is crucial; the key is having a healthy body. Why do people live? It is simply the process of having a healthy body while continuously refining their soul.
Choose a trading philosophy that suits you.
The Dao represents the logic of things, while the Shu represents the methods and ways. As the saying goes: 'With the Dao but no Shu, the Shu can still be sought; with the Shu but no Dao, the Shu is ineffective.' The birth of a trading philosophy represents a person's knowledge, insight, and courage. Through continuous ups and downs in the market, one ultimately grasps the basic logic of trading, which is in accordance with the rules.
The investor's biggest enemies are the three psychological factors: hope, fear, and greed. Having your own trading philosophy also requires overcoming human weaknesses—hope, fear, and greed. When the market is about to fall, it should be filled with fear, but investors feel hopeful instead; conversely, when the market is rising and they fear a pullback, they should have the greatest hope but instead feel fear. This is the reason traders struggle to earn substantial profits. Having your own trading philosophy and forming a trading system can help you overcome human weaknesses. When a market opportunity arises, let profits run; when funds incur losses, let yourself exit to achieve great wealth.
In conclusion: Only this type of person can make money in the cryptocurrency market; it doesn't matter what techniques or methods you use, but rather your discipline. Market trading is sometimes not a battle of strategy but a battle of time and patience.
There is a very naive way to trade cryptocurrencies that will keep you 'always profitable'; invest 30 million!
A new round of bull market in cryptocurrency is on the verge of starting, and the goal of this round is to achieve true financial freedom.
Advice from a cryptocurrency expert after losing tens of millions: Eight things you must know.
1. Stay rational, avoid emotional trading.
Suggestion
Control emotions: During periods of intense market fluctuations, stay calm and avoid making impulsive trading decisions due to fear or greed.
Formulate a plan: Develop a clear investment strategy and plan, and strictly adhere to it without being disturbed by short-term fluctuations.
2. Continuous learning and research
Suggestion
Deepen learning: Continuously learn about blockchain and cryptocurrency-related knowledge, understand technical principles, market dynamics, and project backgrounds.
Focus on authoritative information sources: Follow authoritative cryptocurrency news websites, blogs, and social media accounts to get the latest market information.
3. Diversify investments to reduce risk.
Suggestion
Diversified investment: Do not invest all your funds into one project; spread investments across multiple promising projects and asset classes.
Regular adjustments: Periodically evaluate and adjust your investment portfolio based on market changes and project developments.
4. Do good risk management.
Suggestion
Set stop-loss points: Set reasonable stop-loss points for every trade, and stop losses in time to avoid further losses.
Control investment proportions: Avoid allocating too much capital to high-risk projects, reasonably control investment proportions, and ensure the safety of funds.
5. Choose a safe trading platform and wallet.
Suggestion
Choose a reliable platform: Select a well-known, secure trading platform with good user reviews for trading.
Strengthen security measures: Use hardware wallets to store assets, enable two-step verification and other security measures to protect your funds.
6. Focus on long-term value, avoid short-term speculation.
Suggestion
Long-term investment: Focus on projects with long-term development potential, formulate a long-term investment plan, and avoid frequent short-term speculation.
Patience in holding: For projects with potential, maintain patience and wait for the gradual realization of their value.
7. Maintain a good mindset and a healthy lifestyle.
Suggestion
Balance life: Do not overly focus on market fluctuations; maintain a balance between work, life, and investments.
Take appropriate breaks: Engage in exercise, rest, and entertainment to maintain a good mental state and avoid excessive anxiety and stress.
8. Regularly review and summarize experiences and lessons.
Suggestion
Regularly summarize: Periodically review and summarize your investment experiences, analyze the reasons for successes and failures, and continuously optimize investment strategies. Learn from others' experiences: Learn from other experienced investors, drawing on their successful experiences and lessons to improve your own level. Reflecting on my early days in the trading market, I sought every possible way to find knowledge about this field online, hoping to learn everything as soon as possible so I could start practical trading and make money.
When I first learned technical analysis, besides understanding the basic candlestick patterns, I began exploring moving averages.
The concept of moving averages is simple, but there are many techniques that can be applied. It is a fundamental and important technique in stock market technical analysis. This article aims to explore what moving averages are, how to interpret them, and their common applications, hoping to provide explorers with a basic understanding of moving averages.
What is a moving average (MA)?
Moving Average (MA) is a commonly used indicator in technical analysis, composed of the average closing prices over a previous period.
For example: 5MA means it is a line formed by the average closing price over the past 5 days, calculated by summing the closing prices of the past 5 days and dividing by 5 (the number of days). The smaller the number in front of MA, the shorter the moving average period.
Moving averages are composed of individual price facts, but their interpretation is greatly influenced by human factors. For example, some people believe that moving averages represent the average holding cost of entering the market during that time period.
In my experience, shorter-period moving averages can indicate price direction earlier, but due to their short period, they are also very sensitive to price changes, resulting in lower accuracy compared to longer-period moving averages.
In contrast, long-period moving averages are not as responsive to price as short-period moving averages, as trends may have already begun for some time before reflected in long-period moving averages. However, they are less sensitive to price fluctuations, so their trends are more gradual and have higher accuracy. By using short, medium, and long-period moving averages in relation, one can attempt to predict price trends and further analyze price movements.
For example, commonly heard terms like golden cross, death cross, breaking above the moving average, and falling below the moving average are extensions of the moving average concept. However, predicting the market using only moving averages can easily lead to mistakes, so they are usually analyzed in conjunction with volume and other indicators.
That's all for today. During the bull market phase, many people hope to have a discussion. If you really can't manage the cryptocurrency market on your own, don't force yourself; find a mentor early, learn the latest information, plan, embrace the bull market, improve your win rate, and say goodbye to being stuck at high positions.
$LPT $MOVE $POL
