Core Principles for Profit in the Cryptocurrency Market
$ZEC has been deeply involved in the cryptocurrency market for many years. I earned 2 million with a solid strategy, and today I am sharing 9 core principles that are applicable for both beginners and experienced players. The core logic boils down to two points: go with the trend and manage risks.
1. Identify Quality Assets During Market Downturns
When the market crashes, if your holdings only drop slightly or fluctuate, there is a high probability that strong hands are supporting the price. Such assets can be held with confidence, as the likelihood of future price increases is high. Be sure to distinguish relative declines; a 10% market drop with a 2%-3% decline in your asset indicates strong resilience.
2. Moving Average Trading Method for Beginners
For short-term trades, look at the 5-day moving average: if the asset price is above and the moving average is trending upwards, hold; if the closing price drops below, sell. For medium-term trades, look at the 20-day moving average: if it's trending above, hold; if it drops and does not quickly recover, take profits or cut losses. The key is to stick to the execution.
3. Analyze Volume and Price During Major Uptrends
If the uptrend is clear (higher lows and new highs) and there is no significant increase in volume, buy decisively. If the price rises with volume, continue holding; if it drops without breaking support, continue holding; if it falls with increased volume below the trend line, reduce your position.
4. Ironclad Rules for Short-term Trading
If there is no movement in 3 days after buying, sell to avoid wasting capital; if losses reach 5%, cut losses unconditionally to preserve your capital for future opportunities.
5. Signals for Rebound from Oversold Conditions
If an asset drops more than 50% from its peak and falls for 8 consecutive days, it enters an oversold state, and a small position can be taken to follow the rebound. Be cautious to take profits and not to get too attached.
6. Prioritize Leading Coins
Leading coins have strong growth and resilience against declines. Follow the logic of "buying high in the direction of the trend"; after confirming the trend, buy at relatively high points and sell at even higher points without blindly buying or selling based on the extent of price changes.
7. Follow the Trend, Don't Catch a Falling Knife
Abandon the illusion of “buying at the lowest, selling at the highest”; buying only after confirming the trend is appropriate. Do not insist on finding the bottom in a downtrend; promptly abandon weak assets that are underperforming the market.
8. Establish a Trading System for Steady Profits
Single-instance profits do not count; sustained profits rely on a system (selecting assets, timing trades, stop-loss and take-profit strategies, position management). Review each trade to differentiate between luck and skill.
9. Learn to Maintain Capital First
Being in cash is an important strategy; do not force trades without confidence. Prioritize capital preservation before seeking profits; it’s about the success rate, not the frequency of trades.
The way of the cryptocurrency market cannot be achieved alone. If you have any trading confusion, feel free to communicate; let’s seize certain opportunities together for steady profits!
