First of all, survival is the first priority for development. Whether in real life or in the crypto world, you have to survive to eat and drink.
Therefore, this tutorial focuses solely on spot trading.
Without further ado, after all, teaching people is not the same as teaching things; once taught, it will be learned.
Assuming you have a principal of 10,000 U, and you were misled by some irresponsible teacher to all in on a certain coin.
Here, I will use ACT as an example.
First, take a look at the historical K-line chart of ACT.
You buy ACT tokens worth 10,000 U at this lowest point (0.417 each) (ignoring fees).
So you can have a maximum of 23980.815. We take the integer, 23,980 tokens, worth 10,000 U.
Then you hold these tokens, and the next day you find that the price rises to a maximum of 0.6828 each, at which point your floating profit is about 6374 U.
But soon the next day, after a brief breakout to 0.8098, it fell to a closing price of 0.6086. Although the profit may be given back, your status is still profitable at this point.
You feel a bit discouraged, but the enthusiastic teacher in your group is still encouraging you to hold on. After that, it dropped for 3 consecutive days, and the price reached a closing price of 0.5128.
You have been motivated by the enthusiastic teacher in the group these past few days. After all, it was he who told you to buy at the price of 0.417. Now, although there is profit giving back, you still insist on holding.
In the meantime, on December 19, 2024, the big coin has already plummeted for two days, and the price of ACT has also been dragged down.
The ACT tokens in your hand, apart from profit giving back, have even incurred a floating loss of 1700 U, which is 17% of your initial principal.
Your current principal has reached 8300 U.
After dropping for more than 4 hours, you really can't stand it and want to discuss it with that teacher, but you find out that the other party's account has been canceled.
You are suddenly at a loss, trembling all over, gritting your teeth but helpless. You don't know how the market will perform later, whether it will continue to drop. You are reluctant to cut losses, but you have no good solution.
Cut losses, floating losses become actual losses. But if you don't cut losses, the price continues to drop, and your entire principal will be lost. Moreover, due to the big coin's collapse, there is no hope of breaking even in the entire market.
Suddenly, your good brother with the code name 'A Comical One' learned about your loss and immediately gave you a plan to break even.
Code name - Survival by Cutting Tails
Your good brother made a plan for you like this.
First, you conduct a basic analysis of ACT and find that the price on the 20th is a very dangerous place.
Because there is no support below, the entire coin was initially pulled up in price, causing a new low.
So there is a clear resistance above ACT, which is around the price of 0.4, a significant resistance zone.
(For specific reasons, please see How to Understand the Market - Episode 1 (Support, Resistance, and Trends))
Then your good brother took over your account, helping you break even while explaining to you. (Excluding fees, but profits after income are rounded down, 10.4 U income is counted as 10 U income)
Now sell 30% of your ACT tokens, for example, selling at a price of 0.32.
At this point, your principal changes from 23980 ACT + 0 U to 16786 ACT + 2302 U.
When the price reaches 0.34, sell the remaining 30%. The principal remains 11750 ACT + 4014 U (2302 U + 1712 U)
Next, when the price drops to 0.29, use 30% of your U to buy, spending 1204.2 U, gaining 4152 ACT.
Now the principal has reached 15902 ACT + 2809.8 U.
Then the price rose to 0.31 and you sold a total of 30% of ACT, which is 4770.6 ACT, gaining 1478 U.
The principal has reached 11131.4 ACT + 4281.8 U.
When the price continues to rise to 0.33, sell 30%, which is 3339.42 ACT, gaining 1102 U.
The principal has reached 7791.98 ACT + 5383.8 U.
When the price reaches 0.35, sell 30%, which is 2337.6 ACT, gaining 818 U.
The principal is 5454.38 ACT + 6201.8 U.
When the price drops to 0.32, spend 30% of your U to buy ACT.
The principal has reached 11268.38 ACT + 4341.26 U.
Did you notice? Last time, when ACT was 11131.4, U was 4281.8, but now it is 4341.26.
This time, compared to last time, U has increased by 1.13%
Then continue to drop, continue to buy, sell when it approaches the resistance level of 0.4, and buy when it is close to 0.29.
In this way, as long as you don't all in at once, you can continuously arbitrage until you break even.
If you are lucky, you might break even, and besides the 10,000 U, you still have some ACT tokens.