On the first day after the National Day, A-shares surged as expected after opening, with nearly a thousand stocks hitting the daily limit. Then I saw some friends in the group also began to continue discussing A-shares, and one friend lamented: The market was closed at the opening, and there was no way to take over the shares, and they could not buy them at all.
Today (October 8) seems to be a memorable day for the A-share market. Some people will become rich from today, while others will go bankrupt from today. Now the overwhelming media/self-media seem to be promoting and discussing A-shares, so we will not share too much on this topic. Let's return to our own focus and continue to discuss the topic of the crypto market.
First, let's talk briefly about the market:
Currently, Bitcoin is still moving along the channel. Although it fell to a low of $59,860 during last week’s decline, it still closed above the short-term support level and continues to remain above the middle line of the channel, as shown in the figure below.
Since entering the downward channel in March this year, Bitcoin has now reached a critical position. Combining the trend and macro news, we remain optimistic about the market. As for whether it will continue to fluctuate or directly break through the downward channel and start to rise, we don’t know yet. Anyway, we have not moved the Bitcoin in our hands, and we will continue to hold it patiently and wait for the new direction of the market.
Next, let’s take a look at some important data in recent days:
As for the US dollar index, it has been relatively strong in recent days, which should be mainly due to the September non-farm data released by the United States last Friday (October 4). According to the data, the number of non-farm employment in the United States increased by 254,000 in September, far exceeding the expected 150,000. At the same time, the August data was revised up from 142,000 to 159,000, and the July employment data was revised up by an even larger margin, by 55,000 to 144,000.
Because the unemployment rate unexpectedly dropped to 4.1%, lower than the expected 4.2%, at least in terms of data, it proved that the US economy is still healthy. Boosted by the expectation of a soft landing of the economy, the US dollar index has directly driven the continuous rise in the past few days. As shown in the figure below.
The release of non-farm payrolls data also seems to have cancelled the market's bet on a sharp interest rate cut in November. A few days ago, many institutions/analysts predicted that the Federal Reserve would continue to announce a 50 basis point interest rate cut at the November interest rate meeting. However, judging from the data on the forecasting website, the view has changed significantly. Most people believe that the interest rate may be cut by 25 basis points next month, and some people even bet that there will be no interest rate cut in November. As shown in the figure below.
In addition, this week's focus also includes the release of the Federal Reserve meeting minutes on October 10, the release of the US inflation data for September, and the financial reports of financial giants (such as BlackRock, JPMorgan Chase and other institutions will announce their third-quarter financial reports on October 11). Of course, we also need to pay extra attention to the development of the situation in the Middle East, which may have a certain impact on the trend of the crypto market.
In addition to the above important economic data, there is also the FTX compensation plan mentioned in the previous article. According to the news on October 7, the judge of the Delaware Bankruptcy Court in the United States has officially approved FTX's bankruptcy reorganization plan, which marks the beginning of the compensation procedure two years after the exchange's collapse. 98% of creditors will receive at least 118% of the compensation amount. Although some creditors are dissatisfied with the failure to pay according to the original value of the cryptocurrency, the court still decided to settle in cash. The judge also reiterated that the value of FTX's native token FTT is zero (but it does not affect FTT becoming a MemeCoin and continuing to be hyped by some people).
Although the crypto market is still in a bull market, the current market is rather boring. I heard that many friends in the cryptocurrency circle have recently withdrawn from the circle and went to buy A shares. Whether it is the stock market or the crypto market, no one will dislike the bull market, because the bull market always gives people a feeling that they can make money and make a lot of money.
The more bullish the market is, the more likely many people become impetuous, always afraid of missing out on opportunities, and then rushing to whatever is hot. In fact, as long as the cyclicality of the financial market remains, opportunities will always exist. The important thing is not to seize all of them, but to seize the few opportunities that you can understand.
Before we think about how to make money, we should adjust our mindset first. So how should we think about this problem?
1. Set clear goals
Investing is a process, and setting goals is only the simplest first step. Trading is not gambling, and goal setting must also be clear and reasonable.
If you set a goal of a hundred times or a thousand times for yourself right from the start, then you must first think carefully about where the hundred times or a thousand times the profit comes from. If you cannot figure out the trading logic, then you are just one of the stepping stones for others to achieve their goal of a hundred times or a thousand times.
In addition to trading (spot/contracts), many friends will also choose DeFi for financial management. So when setting or choosing APY goals, you should also make reasonable considerations. Don’t invest in small currencies for high annualized rewards (such as more than 100%). What you want is high APY returns, but maybe what they want is your principal.
2. Conduct a self-assessment
In addition to goal setting, you also need to conduct necessary self-assessments based on your own positions and strategies, while keeping yourself focused and maintaining a good attitude.
A few days ago, a friend left me a message in the background and asked: I have recently noticed that the growth of altcoins such as SUI, ALEO, and ATT is quite good. Can I buy some?
Hualihuawai has received many questions like this before. I found that many new friends who follow Hualihuawai like to ask some interesting questions right away. For example, if they see a certain coin goes up, they will leave a message to ask if they can buy it. If they see a certain coin goes down, they will ask if they should sell it...
Some people who have just entered this field always think about making a lot of money or getting rich overnight, but as soon as they see the price going up, they want to chase it, and when they find it going down, they panic and sell their stocks. Then when they encounter a problem, they just look for someone online hoping to find the ultimate answer to solve the problem. If they invest in this way, then in the end they will most likely lose everything.
Investing is a serious matter. It requires necessary screening, allocation, and optimization of position strategies for projects based on your own risk preferences and capital size, rather than directly taking other people's decisions as your own. No one on the Internet will be responsible for your own investment results (if there is, they probably just want to defraud your principal).
Be sure to think clearly about where your boundaries are, and don't just go for FOMO or blindly follow the hot headlines. Some money others can make doesn't mean you can make it too; some things others can do don't mean you can do it too.
In addition to the evaluation from your own perspective, it also includes the evaluation of the specific project itself, that is, you at least need to know what you are buying, how much loss you can accept, etc., rather than simply buying something because others say it will rise, or buying something because you see it rising well.
3. Abide by trading discipline
Trading discipline is the specific action that needs to be taken after a comprehensive assessment of personal goals, risk preferences, and position strategies.
Actions can be set differently according to different cycles, such as long-term, medium-term or short-term. For example, we have also shared in previous articles that we have invested in Bitcoin on a monthly basis since May 2022, and have been doing so for 20 months, from around US$38,000 to around US$17,000, and then from around US$17,000 to around US$40,000. In fact, there were some doubts about the market during this process, and the reason why we were able to persist was mainly because we strictly abided by our own trading discipline.
For a long-term trading process, you may often give up halfway due to reduced motivation. Therefore, setting trading discipline for yourself is the key to overcoming obstacles. It is also important to abide by trading discipline for short- and medium-term transactions.
As for the specific enforcement disciplines, there may be many, which need to vary from person to person. Here we just list a few that may be more common, such as:
- Try to stay away from leverage
- Do not add more positions as the price goes up, and take profits in batches according to the target
- Don’t buy more as the price drops, and stop loss according to the target (unless you are optimistic about the long-term and plan to hold it for a long time)
- Do not change positions frequently
- Don’t touch it if you don’t understand it, and always put protecting your capital first
- MemeCoin allows you to play with a small position and accept that it may return to zero at any time
- etc……
4. Develop a growth mindset
Many people like to compare themselves with others. For example, when they see a friend in the group making millions of dollars by investing heavily in MemeCoin, they are very envious and want him to recommend a wealth code to them, hoping that they can also become rich overnight. There are also many people who always hope to take advantage of others, such as waiting for others to send them a wealth code, and then directly buy it to become rich overnight.
In any market, only a small number of people can really make big money. Don’t compare your hard-earned money with other people’s pocket money. For example, someone else’s $10,000 purchase of a local dog may only be a small amount of money, and it doesn’t matter if it goes to zero. But if you take the $10,000 you borrowed and try to gamble like others, there is a high probability that something will go wrong.
Everything is dialectical. If you are not mentally prepared to lose money, it is difficult to make a lot of money by your luck. Of course, I do not deny that there may be the chosen ones in this world. Every bull market cycle seems to give birth to a few topic figures who are destined to become rich. If you also think that you are the chosen one, then I will not stop you from doing anything.
In short, in any field (including the crypto market), if we want to survive in the long run, we need to actively cultivate our growth mindset and focus on our daily progress. What we have to do is actually very simple, that is, insist on doing some small things that are meaningful to ourselves every day. As long as we persist, we can basically be ahead of 90% of the competitors in the corresponding field.
We can try to start with small goals. For example, I set myself a small goal of writing 2-3 articles a week a few years ago. I have persisted and have written more than 2 million words so far. In this process, I have a more obvious feeling that every small step forward will strengthen my belief in my growth. In fact, this principle is also applicable to investment. Don't always think about being able to go all in and get rich overnight. Set your own goals, conduct self-evaluation, abide by trading disciplines, and cultivate a growth mindset. Slowly stick to it and you will find a different self.
Mr. Yang Jiang once said: No matter which step you reach in life, there are people looking up at you from below and people looking down at you from above. If you look up, you feel inferior; if you look down, you feel complacent. Only when you look straight ahead can you see the real you.
This is the end of our sharing of this issue. For more articles, please visit the homepage of Hualihuawai. The above content is only a personal point of view and analysis, which is only used for learning records and communication, and does not constitute any investment advice.
