⭐ First, determine your positioning:
Investors (value investing) characteristics: long cycles.
Speculators (trend capturing) characteristics: short cycles.
Determine your capital allocation and entry methods based on your positioning.
Regular investment: usually value investing, a preferred investment method for professionals.
Benefits: fearless of any short-term market fluctuations, easy to persist until external incremental funds arrive.
Drawbacks: long cycles, novice traders may have emotional control issues that disrupt the regular investment plan.
Trend capturing: based on market sentiment, technical analysis, and experience to engage with market liquidity.
Benefits: can achieve returns of 30% or even higher within days or weeks.
Drawbacks: requires strict trading reserves and emotional management, prone to significant short-term losses.
⭐ Understand the commonly used trading methods in the crypto space:
Spot trading: buying and selling, easy to get started.
Leverage trading: introducing the logic of leverage, especially important for trader capital management.
Contract trading (USDT-based and coin-based): allows for extremely high leverage, amplifying trader emotions.
Options: fearless of short-term fluctuations but tests the trader's ability to grasp trends.
On-chain participation in projects or trending memes: gain a deeper understanding of blockchain.
⭐ Use tools
Exchanges: for example, the Binance exchange, known as the top exchange, and other exchanges that I will not detail here.
Market observation method: TradingView is highly recommended and has been consistently used as a high-level market observation tool for all technical analysis.
Information acquisition: CoinGlass, AiCoin, Jin10 Data, etc.
On-chain wallet: The web3 wallets provided by major exchanges are usually sufficient.
⭐ Entering trades
Position management: the priority of position management is higher than entry and exit trading.
If you want to withdraw a percentage of your assets for investment, consider which coins to allocate.
What trading methods to use, and how to connect spot, contracts, and options together.
Break down spot trading position management, what is the proportion of stablecoins or investment coins (mainstream coins and altcoins) in each category, and how to adjust your USDT position ratio based on market changes.
Break down contract trading position management, focus on the value of your position (actual leverage).
Break down options, how to allocate, etc.
Entry and exit logic:
Emotion: make proper use of emotions between greed and fear to navigate smoothly.
Technical analysis: analyze the assets you are optimistic about, determine the entry points for speculation, outlook space, and stop-loss levels after the structure is broken.
Information: Generally, the information we know is lagging for the market; traders need to have their own understanding of the overwhelming information available each day.
KOL: compare and validate your analysis against KOL's insights; there are always people better than you. There will be growth every day in the market, and sometimes leveraging a friend's emotional value can quickly build foundational growth. However, there is a significant downside: the widespread marketing of profit-making abilities in the market can lead novice retail traders to fall into scams.
Understand the exchange's rebate system, choose KOLs who can provide value for binding (emotional value, knowledge value, opportunity value) to obtain fee reductions and cashback. This is very important for long-term traders.
Please establish your understanding of the market before participating in trades, and have an understanding of market conditions. Do not blindly trust technical analysis; respect the uncertainty of the market. Technical analysis is just a tool for trading assistance; what truly directs your entry and exit is your brain!
Everyone in the market, including newcomers, veterans, and KOLs, participates in trading and engages in speculation. Timing, location, and human factors are essential to making big profits. However, do not overlook the role of technical analysis knowledge and financial theory knowledge; these may not make you money but will certainly reduce unnecessary losses.
I am the protective umbrella for retail traders; I enjoy analysis. Are you still in the rain? I’ll hold the umbrella for you. Follow me, and you will thoroughly learn to plan your trades.