If your capital is within 500,000 and you want to succeed quickly in the cryptocurrency market through short-term trading, please read this post carefully. After reading, you will gain a clear understanding of the essence of short-term trading! I am 34 years old this year, have been in the market for 10 years, and have been a professional trader for 6 years!
Not choosing a finance major in college is one of my biggest regrets in life. Starting from my freshman year, I began to learn about stocks/finance/forex online. The alternating red and green screens filled my life with color, captivating me. With endless inspiration about the market, I blindly opened an account in my sophomore year, slowly understanding the crypto space and Bitcoin through a classmate's introduction. I became more and more interested and thus started my investment journey.
Like most friends who have just entered the market, I was initially fascinated by technical indicators, constantly using cryptocurrencies for backtesting to find patterns; eager to enter low-priced coins or those that have significantly retraced, believing their safety was higher. In fact, this understanding of the market is completely wrong. Later, I realized that if you want to quickly gain returns in the market, you must trade short-term. Combine mid-long term compounding as well!
The conclusion is: do not let the blood of profit cloud your judgment. You must understand that the hardest thing in the world is to sustain profits. You must carefully review whether it was luck or skill. A stable trading system that suits you is the key to continuous profits. There's a saying that left a deep impression on me: if you don't occupy the ideological territory, others will.
Today, I share with you the essence of my trading philosophy, which has allowed me to stand firm in the market for a long time. If you study seriously, you will definitely gain a lot and your understanding of trading will change drastically!
After so many years of trading, I've made profits and sustained losses. First, summarize the main reasons for losses, some of which I have also committed.
Leverage is a double-edged sword; used well, you can run faster than others; of course, on the contrary, if used poorly, you can die faster than others.
After spending a long time dealing with contracts, you will find that trading spot becomes very simple. Many beginners hope that a single trade can yield huge profits, turning 10,000 into 1,000,000, or losing 50% from 1,000,000 to 500,000, then needing to double back to 1,000,000, and returning to zero is just a cycle.
Therefore, newcomers are most easily self-absorbed, and after making a few profits in the market, they feel they are exceptionally talented, and in excitement, they go all in, only to return to zero. Those who truly survive in the cryptocurrency market never put themselves in a desperate situation. From the moment they are fully invested or heavily invested, it is destined to be a loser. I hope crypto friends remain sufficiently vigilant in leveraged trading!
Experienced players choose to absolutely go flat and observe when the market trend is uncertain whether to rise or fall; they won't rush to act, but enter quickly when the trend is clear. They also enter with small positions, while many ordinary retail investors operate frequently and heavily when the market is unclear, leading to continuous losses. If they encounter aggressive major players, the losses will be even greater.
Contradicting the medium to long-term trend, fighting against the market leads to death. Many people think that their futures losses are due to the trading cycle being too long, and that trading short-term will be fine. However, when losses are clearly against the market and stop-loss is needed, there is always a psychological struggle: to stop-loss or not? Sometimes there is always luck involved, thinking the price will come back, but long-term resistance against the trend leads to death. Worse yet, inexperienced traders who do not understand the trend hope to average down by adding positions, but later find themselves drifting further away from the market trend and their own positions, resulting in heavier positions and quicker losses. They are on the path to death from the start.
Neither over-leveraging nor holding positions, frequent trading, chasing highs and cutting losses.
After many twists and turns, the meat that can be cut becomes smaller and smaller, and eventually there is no meat to cut, leading to death. Most reasons for losses and liquidation can be summarized as the above three types, like those who are too greedy, basically they are heavily invested. For details, see the top ten blind spots below futures trading.
Full position trading --- full position must lose.
Frequent trading --- lack of technical guidance.
Counter-trend trading ---- high risk with low probability.
Lock-up trading... - does not accept the fact of losses.
Lowering and raising the average holding price ---- wrong on top of wrong.
Guessing tops and bottoms, not setting stop-losses ---- finding reasons for mistakes.
Go long when full, go short when empty --- overly pursuing perfection is aimless.
Believing in news and blindly following trends ---- lack of understanding of the market.
Not good at self-reflection, doubting the market ---- generates fear of the market.
Formulate a long-term trading plan --- the future is uncontrollable.
Many times, trading in the cryptocurrency market is like driving on the road. First, you learn how to drive at a driving school. Once you know how to drive, if you don't follow traffic rules, an accident will eventually occur. Even if you follow traffic rules, you might not hit someone, but someone can hit you; there are pitfalls everywhere. So, to drive safely, you also need to learn how to avoid those pitfalls.
So what are the trading rules in the market?
See below for the eight rights and eight wrongs of cryptocurrency trading:
Going with the trend is right; going against the market is wrong.
(Once a trend is formed, it is hard to change in the short term)
Light positions are right; heavy positions are wrong ---- position affects attitude, attitude affects decision-making.
Being content is right; being greedy is wrong ---- greed is the enemy; being content is the key to happiness.
Taking stop-loss to protect profits is right; letting it flow is wrong ---- protecting capital comes first, making money second.
Objective operation is right; subjective analysis is wrong. Objective operation, obey the rules.
Waiting patiently is right; being impatient and impulsive is wrong. Cultivate patience and act at the right moment.
Adding positions with profits is correct; adding positions when trapped is wrong. Profit is the right direction; being trapped is the wrong direction.
Being calm is right; being anxious about gains and losses is wrong. The essence of trading is the confrontation of human nature and mentality.
Trading and realizing the Dao is the same process, from seven losses to two breakevens and then to one profit, it is simply about being focused and not greedy for various profit models; firmly sticking to one trading system will eventually turn it into your ATM over time.
These days, I am preparing for the divine single that is about to start!!!
Comment 168 to get on board!!!
Impermanence brings impermanence brings impermanence!
Important things are said three times!!!