A survival guide for cryptocurrency trading from loss to gain: 5 stages to help you transform from a novice to a trading expert.
The circle is like a magnifying glass, which can infinitely amplify your greed and also make hidden fears nowhere to hide. Some people have flipped their accounts overnight here, while others have lost their principal in just a few days. In fact, the key from loss to profit has never relied on luck to bet on the market, but on mastering a set of executable trading logic - today's article will break down this logic into 5 stages, helping you build your own cryptocurrency trading system step by step to make steady profits.
Phase one: First, understand yourself - the inner map of a trader.
Many people’s first question when entering the crypto world is 'which coin will rise,' but they overlook the most critical issue: their emotions are quietly influencing their wallets.
1.1 The nemesis of trading: It’s not the market; it’s your fear and greed.
There’s a strange phenomenon in the crypto world: when the market falls, people know it's low but are afraid it will continue to drop and don't dare to buy; when the market rises, seeing others make money, they can't help but chase high prices, resulting in being trapped. This isn’t about misjudging the market, but being led by 'fear' and 'greed.'
Just like the experience of a beginner named Xiao Li: In May 2021, BTC rose from 30,000 USDT to 40,000, he was afraid of 'buying and then it drops' and kept watching; when it rose to 50,000 USDT, seeing everyone around him showing profits, he experienced FOMO (fear of missing out) and bought in with all his funds - resulting in the market quickly correcting to 45,000, and he instantly became the 'guard at the mountain top.'
In fact, successful traders don’t lack emotions; they understand how to manage emotions with 'discipline.' Staying calm and not chasing highs during market frenzies, and confidently laying out plans during market panic are the keys to making a difference.
1.2 Don't say 'I want to get rich,' first set a tangible wealth goal.
'I want to make big money in the crypto world' - such vague goals often end up being 'I earned but don’t want to leave, I lost but can’t accept it.' Useful goals must be 'specific, measurable, and actionable.'
For example, change 'want to get rich' to: 'In the next 12 months, through trend trading of BTC and ETH, turn 10,000 USDT into 15,000 USDT, with an annual return rate of 50%.' With specific numbers and strategies, you will know what to buy and when to sell, without being swayed by the market.
Take 2 minutes now to write down your 12-month goals: How much money will you trade? Which two mainstream coins will you choose? How much do you want to earn? This will be your first starting point in trading.
1.3 Avoid these 3 thinking traps to save yourself six months of detours.
Many losses in the crypto world are caused by 'assumptions.' Here are 3 common thinking traps that beginners must be cautious of:
'History repeats itself' trap: believing 'BTC halving will definitely skyrocket,' while ignoring changes in current market funds and policies, blindly following the trend;
'Hearing the wind is like the rain' trap: seeing big influencers shout single, trending topics saying which coins are good, jumping in without analysis, ultimately becoming a 'bag holder.'
'Small profits lead to arrogance' trap: just made a little profit and think of yourself as a 'trading genius', starting to trade heavily and chase small coins, resulting in one loss that wipes out all previous earnings.
Remember one sentence: 'The market is always right; the mistake lies within your heart.' Before trading next time, ask yourself: 'Am I buying this coin because of logic or emotion?'
Phase one action: Prepare a trading diary and note your emotions every time you buy or sell a coin (for example, 'panicked and chased high' or 'panic selling'), look back after a week, and you will discover how terrifying the impact of emotions can be on trading.
Phase two: Understand the market - Decode the underlying logic of the crypto world.
Many people feel that the crypto market is 'completely irregular,' but it's actually like a person with a temper; as long as you understand its 'character,' you can find opportunities to make money. The core logic of the crypto market revolves around three words: trend, volatility, and cycle.
2.1 Understand 3 keywords, and you will never be 'scared' by the market.
Trend: It’s the overall direction of the price. For instance, in a bull market, the overall trend is upward, and in a bear market, the overall trend is downward. This is a prerequisite for determining whether you can make money.
Volatility is a daily occurrence in the crypto world; rises of 10% today and drops of 8% tomorrow are quite normal, don’t let short-term fluctuations disturb your rhythm.
Cycle: the 'big rules' of the market, such as BTC halving every 4 years, and after each halving, there is often a significant market trend, this is the power of cycles.
For instance, in 2020, BTC rose from $10,000 to $60,000, which is a bull market trend; in May 2021, it suddenly fell to $30,000, which is a short-term fluctuation; and the market trends caused by halving every 4 years reflect the cycles.
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The 3 most common questions beginners ask, here are the direct answers:
'How to see the trend?': Open the candlestick chart and look at the 200-day moving average (this can be adjusted in the software) - if the price is above the average, it’s likely a bull market; if below, it’s likely a bear market; following the big direction is almost always correct.
'What if the volatility is too high?': Set stop-loss (which will be discussed later), don’t keep staring at the market; no matter how large the short-term fluctuations are, they won’t change the long-term trend.
'What’s the use of cycles?': Knowing the cycle can help you identify big opportunities, such as positioning in advance before BTC halves, rather than waiting to chase after it rises.
2.2 Catch the main upward wave: beginners should avoid small coins and focus on BTC and ETH first.
The 'main upward wave' in the crypto world refers to the stage of a significant rise in a particular coin. Catching one can yield considerable profits. For beginners, it’s unnecessary to chase those 'potentially doubling small coins'; focus on BTC and ETH first - these two coins are the 'ballast' of the crypto world, and the main upward wave is more stable with lower risk.
For example, from the end of 2020 to the beginning of 2021, BTC rose from $20,000 to $60,000, and ETH rose from a few hundred dollars to $4,000, which is a typical main upward wave. At that time, as long as you followed the trend to buy, even if you only invested a few thousand dollars, you could have good returns.
How to judge the main upward wave? Remember two signals: Price hits new highs + trading volume increases. For example, on the day BTC broke $60,000, the trading volume was several times higher than usual, indicating a lot of funds were entering the market, which is a signal of the main upward wave.
Why is it not recommended for beginners to buy small coins? Because small coins are too volatile; they might rise 50% today but drop 80% tomorrow, making it easy for beginners to lose control. First, grasp the trends of BTC and ETH before considering small coins.
2.3 Look at candlesticks and trading volume: Understand the market's 'emotional expressions.'
Candlesticks and trading volume are like the 'expressions' of the market - a lot of red candlesticks indicate market excitement; a lot of green candlesticks indicate panic; high trading volume indicates market activity, and the trend may continue.
For beginners, there's no need to learn complicated candlestick patterns; just remember two simple judgments:
A red candlestick indicates a rise, a green candlestick indicates a fall, and the longer the candlestick, the greater the amplitude of the rise or fall.
Trading volume is the total amount of buying and selling on the day. For example, when BTC is rising, the trading volume increases, indicating that there are many buyers, and the upward trend may continue; when it falls, the trading volume increases, indicating that everyone is panic selling, and it may fall further.
Action suggestion: Spend 5 minutes every day looking at BTC's candlestick chart, recording whether there are more red or green candlesticks that day. Is the trading volume larger or smaller than the previous day? Stick to it for a week, and you will gradually understand the market's 'emotions.'
Phase three: Build a system - Making money in the crypto world relies on 'strategies.'
Many people enter the crypto world by 'guessing the market,' what they earn is luck, and what they lose is inevitable. Those who can make money long-term all have their own 'trading systems' - simply put, they have rules for 'when to buy, when to sell, and how much to run at a loss.'
3.1 Why do we need a trading system? Those without rules will eventually be eliminated by the market.
A trading system is like the 'traffic rules' of driving; without rules, you either run a red light and get hit, or change lanes chaotically and get lost. For example, Old Wang has no system, buys BTC when it rises, panics when it falls, adds positions when he makes a bit of profit, and ends up losing everything; whereas Old Li sets rules: 'Sell when BTC falls below the 200-day moving average, take profit when it reaches the target price,' strictly following them, and ends up making steady profits.
Beginners shouldn’t feel that the system is complicated; it’s actually just about setting a few simple rules: for example, 'sell at 20% profit' and 'run at 10% loss,' and then regardless of how the market fluctuates, follow the rules. Why do this? Because emotions can affect people, but rules cannot - when the market rises, rules can help control greed; when it falls, they help control fear.
Ask yourself now: If I buy coins next time, can I set a rule of 'sell at 20% profit' and strictly execute it?
3.2 Two strategies that beginners must learn: Dollar-cost averaging and trend following
No need to learn those flashy strategies, beginners just need to master two: Dollar-cost averaging and trend following, simple and practical, can outperform most people.
Dollar-cost averaging: Regardless of market fluctuations, buy a fixed amount every week or month. For example, buying $100 of BTC every Monday, regardless of whether it rises or falls today, can lower costs and reduce risk in the long term.
Just like Xiao Ming, who started dollar-cost averaging $200 in BTC each month from 2020 to the end of 2021, directly earning 3 times - dollar-cost averaging doesn’t require watching the market, making it suitable for beginners who don’t have time to monitor.
Trend following: Follow the big trend, buy more in a bull market, and buy less in a bear market. Specifically, look at the 200-day moving average: if the price is above the average, buy more; if it breaks below the average, buy less or watch.
Xiao Hong relies on this strategy, only buys BTC in a bull market, sells at a 30% profit, and although she doesn’t capture the entire market movement, she can steadily earn money each time, and accumulating small amounts can be quite significant.
Action suggestion: If you don’t know which strategy to choose, start with dollar-cost averaging; even if you invest only $50 a month, choose BTC or ETH to feel the rhythm of trading.
3.3 Stop-loss and take-profit: Preserving capital is more important than anything else.
There’s a saying in the crypto world: 'Those who can buy are apprentices, those who can sell are masters.' Here, 'selling' refers to stop-loss and take-profit - this is the 'life-saving talisman' for beginners. Without these two, no matter how much you earn, you may lose it all.
Stop-loss: it means 'run if it drops a certain percentage.' For example, if you buy a coin and set 'sell at a 10% drop,' once it hits that point, no matter how reluctant you are, you must sell. Don't think 'maybe it will bounce back'; there are too many coins in the crypto world that drop by 50% or 80%, and stop-loss can help you preserve most of your capital.
For example, Xiaogang bought a meme coin, fell 20%, and still hesitated to sell, ultimately losing 80%; while Xiaoli set a 10% stop-loss, though she lost a bit, she still had capital to continue trading.
Take profit: it means 'sell at a certain profit.' For example, if you set 'sell at a 20% profit', when it reaches this point, sell decisively, don’t think 'just a little more profit' - the crypto market changes rapidly, and missing the profit-taking point can easily turn gains into losses.
Action suggestion: Before buying a coin next time, first write down 'stop-loss 10%, take-profit 20%' on paper and stick it next to your computer or phone to remind yourself not to change the rules.
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Phase four: Control your mindset - Don't let emotions ruin your trading.
No matter how good your skills are, if your mindset collapses, it’s useless. 80% of losses in the crypto world are due to mindset issues - greed makes you reluctant to sell when prices rise, fear makes you unwilling to hold on when prices fall, and in the end, you become a 'chaser of highs and seller of lows.'
4.1 Greed and fear: The two major 'demons' of crypto traders.
Many people have had such experiences:
BTC rose to $50,000, thinking it could rise to $100,000, unwilling to sell, only to see it drop to $30,000, losing all profits;
BTC fell to $40,000, fearing it would continue to drop, panic selling, only to see it rise to $60,000 later, hitting oneself in frustration.
This is the influence of greed and fear. How to manage it? It’s actually quite simple: rely on rules. Set clear stop-loss and take-profit points, sell when it rises to those points, and run when it drops to those points, don’t let emotions sway your judgment. For instance, tell yourself before each trade: 'Take profit at 20%, no regrets; run at 10%, no hesitation.'
4.2 Diversify investments: Don’t put all your eggs in one basket.
The crypto market is risky, putting all your funds into one coin may lead to overnight wealth or total loss. For beginners, diversifying investments is the safer choice - divide the funds into several portions and buy different types of coins. Even if one loses, the others can make up for it.
For example, Xiao Li put all her funds into a meme coin, and the project fled, losing all her capital; while Xiao Zhao divided her funds into three portions: 50% buying BTC and ETH (mainstream coins), 30% buying mid-sized coins like DOT and SOL, and 20% playing with small coins (high risk but potentially high return). Even if small coins lose, the profits from mainstream coins can cover the losses.
Action suggestion: Check your current holdings; if you only bought one coin, next time try to divide it into 3 portions, buying 2 mainstream coins + 1 mid-sized coin, to experience the effects of diversification.
4.3 Facing violent fluctuations: Stay calm, that’s the biggest advantage.
In the crypto world, daily fluctuations of 30% are normal. Many people panic at a sharp drop and get excited at a sharp rise, resulting in poor decisions. For example, in May 2021, BTC dropped 30% in one day, and many people panicked and sold, only to see a rebound the next day, losing money for nothing.
In fact, when facing violent fluctuations, just remember one sentence: Look at the trend, not the short-term fluctuations. If the price is still above the 200-day moving average (bull market trend), there is no need to panic even if it falls, there is a high probability of a rebound; if it breaks below the average line (bear market trend), even if it rises, don't chase it, it may just be a short-term rebound.
Next time you encounter a significant market fluctuation, first take a deep breath, open the candlestick chart, look at the 200-day moving average, and then decide whether to take action - by calming down, you’ll outperform most people.
Phase five: Become a master - From 'knowing how to trade' to 'being able to make stable profits.'
From novice to master, it’s not about how many technical indicators you understand, but about whether you can execute simple strategies thoroughly and learn from losses. The core abilities of experts are just three: execution, reviewing ability, and patience.
5.1 Execution: Stick to the planned strategy without easily changing it.
Many people have had the experience: set 'sell at a 20% profit', but when it rises to 25%, they think it can go higher and change their plan; in the end, it falls to 10%, and regret follows. In fact, no matter how good the strategy, if not executed, it’s useless - the difference between experts and beginners lies in 'whether they can stick to the plan.'
How to practice execution? Start with small funds. For example, start trading with $100, set 'sell at 20% profit, run at 10% loss,' and strictly execute regardless of how the market changes. After practicing ten times or eight times, you will gradually adapt to 'trading by rules' instead of being led by emotions.
Action suggestion: Next time you buy coins, write your plan on paper and stick it on the wall, for instance, 'sell BTC when it reaches 45,000 USDT.' Until it hits that point, don’t sell.
5.2 Review: Losing money is not scary, what’s scary is not summarizing.
There are no traders in the crypto world who never lose money. The reason experts can make stable profits is that they learn from their losses - this is the importance of reviewing. Reviewing isn’t about 'blaming the market for the loss,' but understanding 'why did I buy this coin? Why did I lose? What should I do next time?'
How to review? Prepare a trading diary and record three things after each trade:
What coins did you buy? Why did you buy them? (Was it based on trends or what others said?)
What were the results? Did you earn or lose?
How to improve next time? (For example, if you chased highs and lost this time, wait for a pullback to buy next time.)
For example, Xiao Wang reviews after each loss, realizes he always chases highs, and later changes to 'wait for a pullback to the 200-day moving average before buying,' resulting in fewer losses. Reviewing is like 'the rearview mirror of driving,' understanding past mistakes can help avoid repeating them in the future.
Action suggestion: After each trade, spend 5 minutes writing a review note, stick it next to your computer, and look at it once a week - stick to it for a month, and you will notice a significant improvement in your trading level.
5.3 Patience: In the crypto world, making money slowly is faster.
Many people enter the crypto world wanting to 'get rich overnight', resulting in chasing highs and selling lows, ultimately losing everything. In fact, the people who can make money in the crypto world long-term are very patient - they do not focus on short-term trends, but wait for big opportunities; they do not trade frequently, but it’s enough to catch one major upward wave.
For example, Old Zhao spends 1 hour each day studying candlesticks and the market, doesn’t trade frequently, only positions in bull markets and waits during bear markets. After 3 years, he hasn’t made 'easy money,' but he can earn steadily every year - this is the power of patience.
Making money in the crypto world is like running a marathon; it's not about who runs the fastest, but about who can finish the entire course. Don’t think about making a fortune overnight; focus on learning the basics well, trading by rules, and gradually accumulating profits. You will find that 'going slower can actually earn more.'
Finally: Your journey in the crypto world starts now
The crypto world is not a casino; it’s a battlefield that requires 'cognition + discipline + patience.' No one can get rich overnight, but as long as you follow these 5 stages step by step: first understand your emotions, then decode the logic of the market, build your own trading system, control your mindset, and finally improve yourself through execution and review - you can transform from a 'novice' to a 'trader who can make stable profits.'
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From 4000 to 40 million, this is how genius traders do it!
Genius = madman, but it's not true, just that the people in the game haven't realized it!
Today, I will share all the practical operations of the genius's trading strategy: Suggestions (like + collect) to avoid losing it later. Let's get straight to the content. The specific operating details are as follows: Assume the current price of Ethereum is 1685, starting position with 100u of capital, 20% is (20u) bought at 1685. Supplement position: when the price rises to 1695, add 10% to the position. When reaching the ideal point, don't rush to close all positions. Follow the next two practical steps. Stop-loss point: If the price falls to 1665, immediately stop-loss and admit defeat, don’t be afraid.
Batch entry techniques can first use 10% of your position for trial, for example, buy in two batches: first 10%, then add another 10% after a small rise. The suggested risk-reward ratio is 1:1.5 or 1:2.6 (for example, set a stop-loss at a 10% loss when earning 15%).
Harvesting techniques close to take-profit: When the price is close to the target take-profit point (for example, just 5-10 points away), sell 70%-80% of your position to lock in profits. For the remaining 20%, don’t rush to sell, raise the stop-loss line by 10-20 points. If the price continues to rise, sell 70% at each key point, and keep raising the stop-loss point on the remaining amount.
What can make this strategy turn the tables? Small steps, quick runs, controllable risk: use only 20% of capital each time, and even if you lose, you can bear it. Increase positions during trends: only add funds when the price rises, which is equivalent to 'chasing highs but not chasing high prices.' Flexible profit-taking: when approaching the target, secure profits first, and for the remaining amount, bet on a larger increase. If luck is good: earning 2-4 times can double your capital. For example: 1st time earns 30% → 130u, 2nd time earns 20% → 156u, 3rd time earns 30% → 203u.
Precautions: Don't let excitement cloud your judgment, don't hesitate! Be decisive, don’t procrastinate, securing profits is very important. Enter positions only when you see clear points: wait during consolidation, and once the price clearly rises or falls, take action. Be ruthless with stop-loss: if it breaks the stop-loss level by 20%, immediately admit defeat. Don’t think 'just hold on a little longer.' Many people die because they hold onto their positions. Don’t be greedy: once you reach your expected profit, take it, and the remaining positions may lose profits if not withdrawn. After closing positions, don’t look at the charts anymore, because it has nothing to do with you.
Remember: Trading is a game of probability. It’s more important to have more winning trades than losing trades; there’s no such thing as 100% winning.
