Everyone should take a look at my tearful reflection after losing 1 million in debt: I realized one thing, only one type of person can get rich from trading cryptocurrencies!
In the cryptocurrency circle, one day is like a year in the stock market. Those who trade cryptocurrencies will no longer have any interest in stock trading. The all-day trading and unrestricted price fluctuations in cryptocurrency satisfy many people's dreams of overnight wealth, which is one of the reasons why it is so popular. This is also why losses in this circle have become a very normal phenomenon.
Every investor who comes into the cryptocurrency circle will experience significant losses, liquidation, and the experience of going from profit to loss in their trading career. Among the many who trade cryptocurrencies, only one type of person can get rich, namely those who have experienced bankruptcy and then summarized their experiences with a big mindset.
Without experiencing liquidation or significant losses, you will never know what stop-loss means; without experiencing the transition from profit to loss, you will never understand the shift from heaven to hell in mindset.
Survival is the first principle.
Sun Tzu said: 'The good fighters of old first put themselves beyond the possibility of defeat, and then waited for an opportunity to defeat the enemy.' It is simple to avoid significant losses; make survival your first principle, and when there is danger to this principle, abandon all other principles. Because no matter how many excellent performances of 100% you have had in the past, losing a single 100% means you have nothing.
Once your funds are obliterated, you are destined to be eliminated. To excel in this game and achieve ultimate victory, all systems and rules must adhere to the principle of preserving capital.
Proper capital management: Every success will only take you a small step forward, but a failure can set you back significantly. This large step hinders the accumulation of funds, which requires opportunities and time. Human nature is always such: the pain of losing 1,000 yuan far exceeds the joy of gaining 1,000 yuan. A large loss can easily affect an investor's mindset. Losing 500,000 from 1,000,000 becomes 500,000, but to increase 500,000 to 1,000,000, you must gain 100%. It takes one hour to walk from the first floor of the Empire State Building to the top, but it only takes 30 seconds to jump off the roof and return to the ground. You cannot control the market's direction, so do not waste energy and emotions on situations you cannot control. Do not worry about how the market will change; worry about what strategies you will take to respond to market changes. Judging right or wrong is not important; what matters is how much profit you gain when you are right and how much loss you can bear when you are wrong.
Every time I see many people in the market haggling over the price of a piece of clothing for half a day or shopping for half a day, yet when it comes to thinking about buying for investors, it doesn’t exceed a few minutes. This is a common trait among many people and is certainly not what someone who wants to make big profits in the investment market would do. If you want to earn big money in the market, investors must be cautious and protect their accounts as if walking on thin ice.
Have a clear operational system when entering the market.
(1) How much do I plan to earn in this wave of market?
(2) What is the maximum loss I can accept? If the market retraces, how much I lose, I must immediately exit;
(3) I must secure a portion of the profit from each operation.
(4) Gradually increase positions to avoid full position trading. As profits rise, constantly raise the profit stop-loss level, and never let already gained profits turn into losses;
(5) Always give yourself another chance to trade, strictly operate according to your trading system.
Trends are the best friends.
The biggest enemy of trading is the patience to wait for clear market trends and overtrading. Bull markets do not end in a day, nor do bear markets. The trading in the cryptocurrency circle is a place I have seen where it can remain dormant for three years, then suddenly take off and last for three years. As long as you have patience, wait for the clear arrival of market trends, find leading stocks, and hold on until the end of the entire bull market, without excessive activity, you can achieve unexpected profits. When trends come, respond and follow. When there is no trend, observe and remain still.
Overtrading is also a major enemy of investment. Those who trade for price differences can only earn small profits, but cannot make big money. Let's calculate the trading fees for overtrading: current virtual currency exchanges charge a commission of 0.2% for each buy and sell, making it a total of 0.4% per transaction. If a trader operates once a day for a year, the annual fee due to trading would be 0.4% * 365 = 140%. You did not read that wrong; it's 1.4 times. Think about it, Buffett strives for 30%, and what about you? Your trading fees for a year are 140%. Additionally, a trader frequently overlooks that the more frequently one enters and exits the market, the more likely they are to frequently change their mind. As the saying goes: the more you do, the more you err; the less you do, the less you err; if you do nothing, you won't err at all, but excessive trading may cause you to miss out on significant market movements.
Plan and then act. Based on obvious price levels, market sentiment, trading conditions, and capital inflow situations, determine the onset of trends. Maintain a broad view of market trends and do not be misled by short-term fluctuations.
Psychological quality is the core.
Trading is against human nature. This game determines that only a few people can profit, while the vast majority are just providing funds for play. In trading, you need to have solid psychological qualities; you must have a mindset and pattern that can handle liquidation. If you enter the market with 10,000 yuan and your heart races for a 100 yuan fluctuation, I advise you to leave this market as soon as possible to ensure your personal safety. If you have a big mindset of wanting to earn 100 million, then fluctuations within 1 million won't affect your mindset, because what I ultimately want is 100 million; 1 million is not within my consideration. This way, you have the opportunity for large profits.
Trading is not only about competing with large institutions, dealers, and retail investors but also about competing with oneself. As the ancients said: 'Competing with heaven is joyful, competing with earth is joyful; the highest realm of struggle is to compete with oneself.' Trading is a psychological struggle you face every moment, constantly asking yourself whether you should sell or hold at this price point and what to do. This is a continuous psychological game that requires solid psychological quality. Additionally, good psychological quality must also ensure good physical condition; good health is key. Why do people live? Life is merely a process of continuously refining one's soul while possessing a healthy body.
A trading strategy suitable for yourself.
The Dao represents the logic of things, while the Shu represents methods and techniques. As the saying goes: 'Having Dao but no Shu, the Shu can still be sought; having Shu but no Dao leads to confusion in the Shu.' The birth of a trading strategy represents a person's knowledge, insight, and courage. Through continuous ups and downs in the market, one eventually grasps the basic logic of trading, which conforms to the rules.
The investor's greatest enemies are: hope, fear, and greed. Even with your own trading strategy, you still need to overcome human vulnerabilities: hope, fear, and greed. When the market is about to decline, investors should be filled with fear, but they remain hopeful; when the market is rising, they fear a pullback, at which point they should have the greatest hope, yet they are filled with fear. These are the reasons traders cannot make a lot of money. Having your own trading strategy and forming a trading system helps you overcome human weaknesses; when the market comes, let profits run, and when losses occur, let yourself exit to achieve great wealth.
In the end: the only people who make money in the cryptocurrency market are this type of person. It doesn't matter what techniques and methods you use, but rather your self-discipline. Trading in the market is sometimes not a battle of strategies but a battle of time and patience.
There is a very foolish way to trade cryptocurrencies that allows you to maintain 'eternal profit', invest 30 million!
A new round of bull market for cryptocurrencies is about to start, and the goal of this round is to achieve true financial freedom.
Advice from a cryptocurrency tycoon after losing tens of millions: Eight things you must know.
1. Stay rational and avoid emotional trading.
Suggestions
Control emotions: During sharp market fluctuations, remain calm and avoid making impulsive trading decisions due to fear or greed.
Make a plan: Establish a clear investment strategy and plan, and strictly adhere to it without being disturbed by short-term fluctuations.
2. Continue learning and researching.
Suggestions
Deep learning: Continuously learn about blockchain and cryptocurrency knowledge, understand technical principles, market dynamics, and project backgrounds.
Follow authoritative information sources: Keep an eye on authoritative cryptocurrency news websites, blogs, and social media accounts for the latest market information.
3. Diversify investments to reduce risks.
Suggestions
Diversified investment: Do not put all your funds into one project; spread investments across multiple potential projects and asset classes.
Regular adjustments: Regularly evaluate and adjust your investment portfolio based on market changes and project developments.
4. Implement good risk management.
Suggestions
Set stop-loss points: Every trade should have a reasonable stop-loss point set, and losses should be cut promptly to avoid further losses.
Control investment proportions: Avoid putting too much capital into high-risk projects, reasonably control investment proportions to ensure capital safety.
5. Choose safe trading platforms and wallets
Suggestions
Choose reliable platforms: Select well-known, secure trading platforms with good user reviews for trading.
Strengthen security measures: Use hardware wallets to store assets and enable two-factor authentication and other security measures to protect your funds.
6. Focus on long-term value, avoid short-term speculation
Suggestions
Long-term investment: Focus on projects with long-term development potential, establish a long-term investment plan, and avoid frequent short-term speculation.
Hold with patience: For projects with potential, maintain patience and wait for their value to gradually realize.
7. Maintain a good mindset and a healthy lifestyle
Suggestions
Balance life: Do not overly focus on market fluctuations; maintain a balance between work, life, and investment.
Relax appropriately: Engage in exercise, rest, and entertainment to maintain a good psychological state and avoid excessive anxiety and pressure.
8. Regularly review and summarize experiences and lessons
Suggestions
Regularly summarize: Regularly review and summarize your investment experiences, analyze the reasons for successes and failures, and continuously optimize investment strategies. Learn from others' experiences: Learn from experienced investors, draw on their successful experiences and lessons to improve your own level. Reflect on the time when I first stepped into the trading market; I searched the internet for knowledge on this subject in every possible way, hoping to learn everything as soon as possible so I could quickly start practical trading and begin making money.
When I first learned technical analysis, apart from understanding the basic candlestick patterns, I started exploring from moving averages.
Although the concept of moving averages is simple, there are many techniques applicable to it. It is a basic yet crucial technique in stock market technical analysis. This article will explore what moving averages are, how to view them, and what common applications exist, hoping to give explorers a basic understanding of moving averages.
What is a moving average (MA)?
Moving average (MA) is a commonly used indicator in technical analysis, composed of the average closing prices over a past period.
For example, 5MA means a line formed by the average closing prices over the past five days. The calculation method is the sum of the closing prices of the past five days divided by 5 (the number of days). The smaller the number before MA, the shorter the period of the moving average.
Moving averages themselves consist of price facts, but how to interpret them is greatly influenced by human factors. For example, some may believe that moving averages represent the average holding cost of positions entered during that period.
In my experience, shorter-period moving averages can indicate price trends earlier, but due to their short duration, they are also very sensitive to price changes, resulting in lower accuracy than longer-period moving averages.
Relatively speaking, long-period moving averages are less sensitive to price changes than short-period moving averages. The trend may have already been established for a while before the long-period moving average reflects it, but it is not as sensitive to price fluctuations, so its trend is smoother and more accurate. Using the relative relationships among short, medium, and long-period moving averages can also attempt to predict price trends and further analyze price movements.
For example, commonly heard terms like golden cross, death cross, breaking above the moving average, and breaking below the moving average are extensions of the moving average concept. However, predicting market conditions solely using moving averages can easily lead to mistakes, so it is usually accompanied by volume and other indicators for analysis.
That's all for today. During a bullish market, many people hope to have an exchange. If you really can't handle it in the cryptocurrency circle, don't force yourself; seek a mentor early, get the latest news, plan, embrace the bull market, improve your win rate, and say goodbye to high-level traps.
