Simplicity is the ultimate sophistication; the highest realm of trading cryptocurrencies is 'being foolish'.
I still remember when I first got into the crypto world, watching dozens of technical indicators every day, the screen a riot of colors, my mood fluctuating with the ups and downs of the K-line. Until I met a senior who had run a convenience store for ten years but achieved financial freedom in the crypto world with a method so simple it was unbelievable.
He told me: 'The most profitable people in the crypto world are not the smartest, but the most patient.'
He revealed that he spends no more than half an hour a day truly looking at the charts, doing whatever else during the remaining time. His secret is merely a regular moving average line. Today, I will share this seemingly 'foolish' yet extremely effective method, combined with my own practical experience, without reservation.
One trick to eat the whole sky: Only recognize one line
Most people lose money, not because they know too little, but because they know too much but execute poorly.
My method is simple to the point of being absurd: open the daily chart and only look at one moving average line. Hold on the line, sell off the line. It's that simple.
Why the daily chart? Because it filters out most of the noise in the market and the traps set by major players. Those who focus on 5-minute or 15-minute candlesticks are like rowing a boat on a turbulent sea, easily getting disoriented. The trend at the daily level is like the direction of the current; once formed, it won't easily change.
The core of specific operations is: when the price of your chosen currency rises above the moving average and the trading volume can also stabilize above the moving average, that is a clear buy signal. At this point, do not hesitate; you can enter decisively.
The art of selecting currencies: only dance with the strong.
I won't look for treasures in a garbage dump. My criteria for selecting currencies are extremely simple: only choose currencies that have a MACD golden cross above the zero line on the daily chart.
Why a golden cross above the zero line? Because the MACD above the zero line indicates a bullish market, and the golden cross signal here is more reliable, with stronger upward momentum. It's like sailing with the current, achieving twice the result with half the effort. Conversely, a golden cross below the zero line often indicates a rebound, with questionable sustainability.
I won't waste time on currencies in a downtrend. There are thousands of choices in the cryptocurrency world; why go against the trend? My task is not to catch the bottom but to follow the trend. Only choose those strong currencies that have entered an upward channel and ride the wave.
Position management: never go all in.
Even with a 99% win rate in trading, there is still a 1% chance of failure. Therefore, I never buy in with my entire position at once.
My position management principle is: buy in batches, sell in batches.
Specifically, when the currency price breaks through the moving average and confirms the trend, I will initiate my first position. If the market continues to improve, I will increase my position at an appropriate time. The benefit of this approach is that even if my first judgment is wrong, I still have funds to average down at lower levels, reducing my average cost.
When selling, I also follow the principle of batching:
When the price increase exceeds 40%, sell 1/3 of your position to lock in some profits.
When the price increase exceeds 80%, sell another 1/3 and let the remaining position continue to soar.
Only when the price of the currency falls below the moving average do I clear my position.
This way, you won't miss out on major trends while also ensuring profits are secured.
Stop loss: coexistence with the moving average
Since we take the moving average as the basis for buying, when the price falls below the moving average, we must sell decisively and not have any delusions.
In my experience, the probability of the price breaking below the moving average through this currency selection method is inherently low. But once it breaks, it often means that the trend may reverse. At this point, it's wiser to cut losses than to stick blindly.
Stop loss is like a braking system; no matter how good the car is, you wouldn't dare to set off without brakes. Trading cryptocurrencies without stop loss is like driving without brakes; it will eventually lead to trouble.
Many people lose money not because of wrong judgments, but because they refuse to admit mistakes. When the market proves you wrong, the best choice is to exit immediately, preserve your strength, and wait for the next opportunity. After selling, if the price of the currency rises back above the moving average, you can buy again.
Mindset determines success or failure: the essence of trading is a game of waiting.
This method sounds simple, but 90% of people cannot execute it. Why? Because human nature always prefers complexity and cannot tolerate simplicity and waiting.
Many successful people I know in the cryptocurrency world are not the kind who stare at the screen every day and trade frequently. Most of the time, they are waiting for the best opportunities and then strike decisively. As my senior from the convenience store background said: 'Making money with a convenience store doesn’t rely on a few explosive products but on stable daily operations. Trading cryptocurrencies is the same.'
Therefore, I do not pursue catching every wave of market movement, only those I can understand; I do not envy others' overnight wealth but stick to my system of stable profits.
Conclusion: Simplicity to the extreme is to be 'stupid' to the extreme.
The cryptocurrency market is not about who makes the most profit, but about who survives the longest. This seemingly 'clumsy' method has helped me through the toughest times in the cryptocurrency market and allowed me to catch major trend movements.
The ultimate mindset for trading cryptocurrencies is simply: 'Choose the right currency, watch the right line, split well, and set strict stop losses.' I hope this method can also help you find your own stable profit path in the unpredictable cryptocurrency market.
Remember, in this market, survival is the hard truth. And to survive, sometimes what you need to do is to be a little 'stupid'.
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