⭐ First, determine your own positioning:
Investors (value investment) characteristics: long cycle.
Speculators (trend catchers) characteristics: short cycle.
Determine your capital allocation and entry methods based on your positioning.
Regular investment: Usually for value investment, a preferred investment method for those with formal training.
Benefits: Unafraid of any short-term market fluctuations, easy to stick to the arrival of external capital.
Drawbacks: Long cycle; new traders might struggle with emotional control, potentially disrupting their regular investment plans.
Trend catching: Engaging in a game with market emotions, technical analysis, and experience against available market liquidity.
Benefits: Achievable returns of 30% or even higher within a few days or weeks.
Drawbacks: Requires strict trading reserves and emotional management; prone to short-term massive losses.
⭐ Understand common trading methods in the crypto space:
Spot trading: Buying and selling, easy to get started.
Leverage trading: Introducing leverage logic, crucial for traders' capital management.
Contract trading (USD-based and coin-based): Allows for extremely high leverage, amplifying traders' emotions.
Options: Unafraid of short-term fluctuations, but tests traders' trend grasping abilities.
Participating in on-chain projects or trending memes: Gaining a deeper understanding of blockchain.
⭐ Utilize tools
Exchanges: For example, Binance, known as the top exchange, along with others that won't be discussed here.
Market observation method: TradingView is a highly recommended platform that I have been using; all technical analysis can be conducted here.
Information gathering: Coinglass, Aicoin, Jin10 data, etc.
On-chain wallet: The web3 wallets provided by major exchanges are generally sufficient.
⭐ Entering trades
Position management: Position management takes precedence over entering and exiting trades.
How much of your assets do you plan to invest, and which cryptocurrencies will you consider allocating?
What trading methods to use, and how do spot, contracts, and options connect with each other?
Detailed management of spot trading positions, what is the allocation of stablecoins or investment cryptocurrencies (mainstream coins and altcoins), and how to adjust your USDT position ratio based on market fluctuations.
Detailed management of contract trading positions, focusing on the value of your position (actual leverage).
Detailing options, how to configure them, etc.
Entry and exit logic:
Emotion: Skillfully use emotions between greed and fear to navigate the market.
Technical analysis: Analyze the assets you are optimistic about, determine the entry points for speculation, outlook space, and stop-loss positions after structural damage.
Information: The information we generally know is often lagging in the market; traders need to have their own understanding of the overwhelming amount of information received daily.
KOL: Compare and validate your analysis against KOL's analysis. There are always people better than you; every day in the market presents an opportunity for growth. Sometimes, leveraging a friend's influence and the emotional value they provide can help you quickly establish foundational growth. However, there is a significant drawback: the prevalent marketing of profit-making abilities may blind retail investors, leading them into scams.
Understand the commission rebate system of exchanges and choose KOLs that provide value (emotional value, knowledge value, opportunity value) to reduce transaction fees and earn cashback. This is very important for long-term traders.
Before participating in trading, establish a preliminary understanding of the market and the trading conditions. Do not blindly trust technical analysis; respect the market's uncertainty. Technical analysis is a tool to assist trading, but the true guide for your entry and exit is your brain!
Everyone in the market, including newcomers, veterans, and KOLs, is engaged in a game of speculation. Success relies on timing, location, and the right people; all are essential. However, do not overlook the role of technical analysis knowledge and financial theory; while these may not guarantee profits, they can significantly reduce unnecessary losses.
I am the protective umbrella for retail investors. I enjoy market analysis. Are you still in the rain? I hold the umbrella for you. Follow me, and you will learn to trade with a plan.
