Profit Protection and Wise Trading: A Sailing Guide in the Ocean of Cryptocurrency
In the vast ocean of cryptocurrency, every investor is a brave sailor, harboring a desire for financial freedom, navigating their small boat in the turbulent market to find their own treasures. However, this ocean is not always calm; sometimes there are fierce winds and huge waves, sometimes there are hidden currents. To sail steadily in this ocean, we need to master an effective sailing guide — the principles of profit protection and wise trading.
Profit Drawdown: The Wisely Rolling Profit Bar
When we seize a profitable opportunity in the cryptocurrency market, such as buying a promising coin and achieving a return of over 10%, our hearts are often filled with joy and anticipation. However, at this point, the real test is just beginning. To protect our hard-earned profits, we need to activate the 'Principal Protection Principle'. This means that once the market reverses and the coin price drops back to our buying price, we will unhesitatingly choose to sell, ensuring the safety of our principal. When profits reach around 20%, we set a stricter selling condition — retaining at least 10% profit. The core of this strategy lies in allowing profits to grow amidst market fluctuations while using profit drawdowns as a reference for adjusting our strategy. We will not blindly chase higher profits, but rather flexibly adjust our profit expectations based on the actual market situation, ensuring the maximization of profits under controllable risks.
The Principal Protection Principle: The Art of Stop-Loss
In the cryptocurrency market, stop-loss is a critically important art. It requires us to decisively cut our losses when faced with losses, preventing further deterioration. After buying a coin, if the market trend contradicts our expectations, leading to a cumulative loss of 15% (this number varies from person to person, but 15% is often considered a reasonable stop-loss point), we should unhesitatingly choose to stop-loss. Although this may cause us to miss subsequent rebound opportunities, more importantly, it protects our principal, allowing us to maintain lasting combat capability in the market. Remember, every stop-loss is a profound reflection on our mistakes, making us more clearly aware of the risks and opportunities in the market, thereby enabling us to make wiser decisions in future trades.
The Principle of Rebuying at Original Price: The Wisdom of Avoiding Missing Opportunities
In the cryptocurrency market, missing an opportunity often hurts more than a loss. To avoid this situation, we need to master the 'Rebuying at Original Price Principle'. After selling a coin, if the market trend goes against our expectations and the coin price drops, while we still have a positive outlook on the future of the coin, we should buy back the same quantity of the coin at the original price at the appropriate time. The benefit of this approach is that we retain the original quantity of the coin while increasing our available funds through selling high and buying back low. If we sell a coin and do not buy back, and the market rebounds to our selling price, we should unconditionally buy back those coins. Although this may increase some transaction costs, compared to the losses from missing an opportunity, these costs are negligible. By repeatedly applying the Original Price Rebuying Principle, we can respond more flexibly to market fluctuations, avoiding missing good opportunities due to momentary hesitation.
In summary, in the cryptocurrency market, we need to maintain a clear mind and a calm attitude at all times. Quick entries and exits do not equate to blindly entering and exiting the market; chasing hot trends does not mean blindly choosing coins. We should formulate appropriate trading strategies based on our risk tolerance and investment goals, continuously adjusting and refining these strategies in practice. At the same time, we must also learn to accept the uncertainty and risks of the market, facing the fluctuations and changes of the market with a peaceful mindset. Only in this way can we sail steadily in the ocean of cryptocurrency and eventually reach the shores of financial freedom.
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