In the cryptocurrency world, the "80/20 rule" is commonly observed, meaning that 80% of the time, the market fluctuates mildly, and real profit opportunities only account for 20%. Since it is impossible to predict when these opportunities will arise, you must always stay in the market. Therefore, position management is crucial; you should not remain fully in cash waiting for a rise, nor should you be fully invested chasing highs. The ideal approach is to maintain a heavier position during rises and a lighter position during declines.
However, many people often adopt the wrong strategy of continuously increasing their positions as the price rises, but lightening their positions when the price falls. This inverted pyramid strategy can lead to significant losses when the market reverses, akin to gambling: feeling good when placing small bets and winning, but once a large bet leads to losses, all previous profits may evaporate in an instant.
Investing requires going against human nature—"be greedy when others are fearful, and be fearful when others are greedy." At market peaks, when everyone is chasing the rise, you should pull out your chips, and re-enter at market lows. Although this counterintuitive approach may feel uncomfortable, successful investors are often those who can do just that.
Greed stems from the hope of recouping losses through the rise of a particular coin, leading to an unwillingness to sell as prices rise. This mindset is very dangerous. You must learn to take profits at the right time, just as you would eat fish by enjoying the middle part, not the head or tail.