After ten years of trading cryptocurrencies and six years of teaching trading, today I don’t want to talk about the abstract. I want to share my practical experience from 'losing all my savings' to 'leading thousands of students to double their small investments' without reservation.

Ten years ago, like many fans, I was attracted by the wealth myth of 'one day in the crypto world equals ten years in the human world' and rushed in with my savings of 200,000 accumulated over several years of work. Without a system, no methods, and no risk control, I only saw 'doubling' and 'getting rich'—chasing high-altitude altcoins, heavily investing in contracts, and trading based on rumors. As a result, in less than half a year, 200,000 was reduced to only 30,000. At my worst, I couldn't sleep all night, watching the waterfall in the K-line chart, not even having the courage to delete the software.

Later, I was unwilling to give up, pooled 50,000 to enter again. This time I slightly understood 'technical analysis', but still operated based on intuition, earning little and losing big; after a year, I lost 70% again. Two major losses made me completely wake up: the cryptocurrency market is not a casino, there is no replicable trading system or strict rules. No matter how many connections you have or how well-informed you are, in the end, it's all 'fetching water with a bamboo basket'.

In the next three years, I turned off all market groups and refused all 'insider information', diving into candlestick charts - reviewing over 100,000 candlesticks, organizing the commonalities of over 2000 losing trades, and deconstructing the core logic of over 100 profitable cases, finally building my own trading system.

Later, many friends around me followed my trades and made money, so I simply started teaching. In these six years, I have trained thousands of students, the youngest started with 5000U and reached 50,000U in six months; the most advanced student went from 100,000U to 1.2 million U. The core of this is the trading logic of 'trend as king, risk control as soul, entry signals, and unity of knowledge and action.'

Today, I have broken down this system into 'core trading system + four major practical strategies + student cases + pitfall avoidance guide'. Whether you are a beginner or an experienced trader, as long as you can settle down to read and execute, you can definitely avoid the pitfalls I have stepped into and achieve steady growth with small funds.

Part One: Core Trading System - The Underlying Logic for Stable Profits (No System, No Trading).

Many people incur losses in cryptocurrency trading due to 'trading based on feelings' - chasing after rises and cutting losses when prices fall, without clear entry, exit, or risk control rules. When making profits, it relies on luck; when losing, it's inevitable. My trading system's core is 'turning uncertain market conditions into certain operations', divided into 4 modules, none of which can be missing:

1. Trend Identification System: Only do 'trend-following trades', do not go against the trend.

The core of making money in the cryptocurrency market is always 'going with the trend'. I have seen 90% of losses come from 'counter-trend bottom fishing' and 'counter-trend shorting'. My trend identification system only uses 3 tools, simple and straightforward, allowing beginners to quickly get started:

Moving Average System (MA): I only use 3 moving averages - MA20 (short-term trend), MA60 (mid-term trend), MA120 (long-term trend).

Bullish Trend: MA20 is above MA60, MA60 is above MA120, all three moving averages diverge upward, only go long, do not short;

In a bearish trend: MA20 is below MA60, MA60 is below MA120, all three moving averages diverge downward, only short, do not go long;

Oscillation Trend: The three moving averages are intertwined, without a clear direction, observe or trade within a light position.

MACD Divergence: The 'warning signal' for trends. For example, in a bullish trend, if the price hits a new high but the MACD red bars shorten, or the MACD indicator does not create new highs, it indicates a trend reversal, prompting a reduction or exit; in a bearish trend, if the price hits a new low but the MACD green bars shorten, or the indicator does not create new lows, it indicates a trend reversal, prompting a stop loss or reversal.

Volume Coordination: 'Confirmation signal' for trends. In a bullish trend, trading volume increases during rises and decreases during corrections, indicating a strong trend; if volume decreases during rises and increases during corrections, beware of trend reversals.

2. Entry Signal System: If 3 conditions are not met, absolutely do not enter.

Many people incur losses because they 'enter as soon as they see a rise', without clear signal filtering. I set a strict rule: must meet 3 signal resonances to enter, any one missing is unacceptable:

Signal 1: Trend Compliance (the previously discussed bullish/bearish trends);

Signal 2: Candlestick Pattern Confirmation: For example, in a bullish trend, look for reversal/continuation patterns like 'hammer', 'bullish engulfing', 'bullish engulfing'; in a bearish trend, look for patterns like 'shooting star', 'bearish engulfing', 'bearish engulfing';

Signal 3: Support/Resistance Breakthrough/Retest:

Breakout Entry: In a bullish trend, when the price breaks through previous highs (resistance levels), and the trading volume increases during the breakout, enter after confirming an effective breakout;

Retest Entry: In a bullish trend, when the price retests MA20 or previous highs (which have turned into support), does not break, and a stop-loss signal appears, enter.

3. Exit Rule System: Knowing how to buy is a student, knowing how to sell is a master.

Exit comes in two forms: taking profit and cutting losses. The core is 'earn enough when you profit, stop in time when you lose.'

Stop Loss Rules (Lifeline):

Fixed Stop Loss: After entering, set the stop-loss level at the 'point of failure of the entry signal' - for example, if entering on a breakout, set the stop loss 1-2 points below the breakout level; if entering on a retest, set the stop loss 1-2 points below the support level, with a stop-loss ratio strictly controlled within 5% (for small funds, it is recommended to keep it at 3%);

Mobile Stop Loss: After making a profit, use MA20 as the moving stop-loss line - as the price rises, MA20 moves up simultaneously. Once the price drops below MA20, exit immediately to preserve most of the profit.

Take Profit Rules (Earn Enough and Leave):

Target Take Profit: Pre-set 2 take-profit levels, the first take-profit level (10-15% profit) reduces the position by 50%, the second take-profit level (30-50% profit) clears the position;

Signal to Take Profit: When a trend reversal signal appears (such as MACD divergence + candlestick reversal pattern), regardless of whether the target has been reached, immediately clear out.

4. Risk Control System (the core of the core): Without risk control, no matter how much you earn, you can lose it all back.

This is the most valuable lesson I learned from two major losses, and it is also the strict rule I require all students to adhere to:

Position Management:

Single Variety Position: For small funds (below 10,000 U), the position must not exceed 30%; for medium funds (1-100,000 U), not exceeding 20%; for large funds (above 100,000 U), not exceeding 10%;

Total Position Control: In a bullish trend, total position must not exceed 70%; in a bearish trend, total position must not exceed 50%; in an oscillation trend, total position must not exceed 30%;

Capital Management: Never trade with 'emergency funds', only use idle funds (money that won't affect your life), and enter in batches, not all at once;

Mindset Management: Daily trades should not exceed 3. After 2 losses, immediately stop trading, no further operations that day; avoid blind increase in positions after profits, and do not rush to recover losses (the more anxious, the more you lose).

Part Two: Four Major Practical Strategies - Core Weapons for Doubling Small Funds (Highly Practical)

My students can double their small funds, the core is these four major strategies, covering oscillation, trends, and extreme markets. Beginners start with the oscillation strategy, while veterans can add trend strategies to amplify returns:

Strategy One: Oscillation Market 'High Sell Low Buy' Strategy (the best choice for beginners).

Applicable Scenarios: When the price fluctuates within a fixed range (MA20, MA60, MA120 intertwined), without a clear trend, for example, Bitcoin consolidating between 30000-40000U.

Core Logic: Utilize support and resistance levels within the range, buying low and selling high to earn the spread;

Operational Steps:

1. Draw Ranges: Identify recent highs (resistance levels) and lows (support levels), and draw the oscillation range;

2. Waiting for Signals: When approaching support levels, look for bullish candlestick patterns (hammer, engulfing bullish), enter long with 30% of your position; when approaching resistance levels, look for bearish candlestick patterns (shooting star, engulfing bearish), enter short with 30% of your position;

3. Set Stop Loss: Set stop loss for long positions 1-2 points below support levels, and for short positions 1-2 points above resistance levels;

4. Take Profit: Take profit on long positions at the midpoint or resistance level (taking profit in batches), take profit on short positions at the midpoint or support level;

Practical Case: Student Xiao Li (starting with 5000U), in November 2023 traded ETH's oscillation (1800-2200U range), using this strategy for 12 trades, profiting in 10 trades, losing 2, achieving 80% profit in 30 days, with funds rising from 5000U to 9000U.

Strategy Two: Trend Market 'Trend-Following Position Increase' Strategy (Core for Doubling Small Funds).

Applicable Scenarios: When the price enters a clear trend (MA20, MA60, MA120 diverge simultaneously), for example, Bitcoin rising from 40000U to 60000U in a bullish trend;

Core Logic: Once a trend is formed, it will not easily reverse. Use the method of 'initial position + additional position' to amplify profits;

Operational Steps:

Confirm Trend: All three moving averages move upward simultaneously (bullish), MACD is above the zero line, and trading volume increases, confirming the trend;

Initial Entry: Price retests MA20 and shows a stop-loss signal, enter with a 30% position;

First Position Increase: Price breaks through previous highs, and trading volume increases, increase position by 20% (total position 50%);

Second Position Increase: Price retests MA20, does not break, increase position by 20% (total position 70%);

Stop Loss: Initial stop loss set below MA60; after increasing position, use MA20 as a mobile stop loss.

Take Profit: Reduce position by 50% at 30% profit, clear position at 50% profit;

Practical Case: Student Lao Wang (starting with 10,000 U), from March to May 2024, traded Bitcoin in a bullish trend (42000-63000U), using the trend-following position increase strategy, initially entering with 3000U, after two increases, total position 7000U, cleared out in May with a 62% profit, with funds increasing from 10,000 U to 16,200 U, achieving 60%+ returns in two months.

Strategy Three: Extreme Market 'Left-Side Layout' Strategy (Advanced Strategy, High Risk High Reward)

Applicable Scenarios: Extreme price fluctuations (like a market crash or altcoin surge followed by a correction), for example, Bitcoin dropped from 69000U to 15000U in 2022, then reached the bottom range;

Core Logic: After extreme market conditions, prices will revert to value. Enter in batches within the 'safety margin' to seek a major rebound;

Operational Steps:

Find Safety Margins: Determine safe zones through historical valuations (like Bitcoin's Stock-to-Flow model), support levels (previous lows, Fibonacci 0.618 positions);

Batch Entry: Initial entry with 10% position (upper edge of the bottom range), second entry with 20% (midpoint of the bottom range), third entry with 20% (lower edge of the bottom range), total position not exceeding 50%;

Stop Loss: Set below the safe zone by 10% (the stop loss ratio for extreme market conditions can be appropriately enlarged, but not exceeding 15%);

Take Profit: When rebounding to previous resistance levels (or 50-100% profit), clear positions in batches;

Practical Case: Student Xiao Zhang (starting with 20,000 U), positioned at Bitcoin's bottom from January to March 2023 (15000-20000U range), entered in 3 batches, total position 10,000 U, cleared out in June when Bitcoin rose to 30000U, profiting 50%, net gain of 5000U, funds increased from 20,000 U to 25,000 U.

Strategy Four: Short-Term Swing 'Quick In and Out' Strategy (suitable for investors with ample time).

Applicable Scenarios: When the price fluctuates wildly in the short term (for example, stimulated by good news or before contract delivery), such as an altcoin rising from 0.1U to 0.2U due to good news;

Core Logic: Capture short-term fluctuations, make quick money, avoid attachment to positions during corrections;

Operational Steps:

Selecting Targets: Choose cryptocurrencies with increased trading volume and clear news catalysts (mainstream coins or quality altcoins);

Entry: Price breaks through short-term resistance (like MA20), and trading volume increases, entering with 20-30% of the position;

Stop Loss: Set 3-5 points below the entry price (short-term stop loss must be strict);

Take Profit: Clear positions immediately when profiting 8-15%, do not be greedy;

Points to Note: Short-term trades should not exceed 2 per day, stop trading after 1 loss; only trade mainstream coins or altcoins with fundamental support, do not touch air coins.

Part Three: Student Practical Cases - The replicability of methods is more important than anything else.

After six years of teaching, my proudest achievement is not how much I earned myself, but how thousands of students have doubled their small funds through this method. Below are 3 typical cases to illustrate how they implemented it:

Case 1: Beginner student Xiao Wu - starting with 5000U, doubling in 6 months.

Background: A complete novice who joined in September 2023, previously lost 3000U trading cryptocurrencies, afraid to trade blindly;

Operational Logic: Start with the oscillation strategy, for the first 2 months only trade Bitcoin and ETH's oscillations, and after familiarizing with the system, add trend strategies;

Key Operations:

October: ETH oscillating range 1800-2200U, made 5 trades, profiting in 4, earning 1200U;

November: Bitcoin in a bullish trend, using trend-following position increase strategy, earned 1500U;

December: Short-term altcoin swing, earned 800U;

Result: After 6 months, funds increased from 5000U to 10200U, achieving a double, the core being 'strictly executing stop losses and position management, not being greedy'.

Case 2: Losing student Lao Chen - Lost 100,000 U down to 30,000 U, used the system to break even and profit over a year.

Background: Trading cryptocurrencies for 5 years, always operating based on intuition, heavily leveraged on contracts, chasing after altcoins, lost 70% in 2022;

Operational Logic: Abandon contracts, focus on spot trading, starting from the risk control system, strictly execute position management and stop losses;

Key Changes:

Previously: Single variety all-in, no stop losses, holding onto losses;

Afterwards: No single variety should exceed 20% of the position, and stop-loss should be strictly controlled at 5%. If you incur losses on 2 trades, stop trading;

Result: In 2023, by combining trend strategies and oscillation strategies, funds increased from 30,000 U to 75,000 U in one year, not only breaking even but also profiting 250%.

Case 3: Small fund student A Lin - starting with 3000U, reaching 28000U in 8 months.

Background: A salaried employee with only 3000U of spare money, limited time, can only trade medium to long-term;

Operational Logic: Focus on trend strategies, only trade Bitcoin and ETH, and avoid frequent trading;

Key Operations:

January 2024: Entered Bitcoin at 28000U with a 30% position, increased by 20% in February, took profit at 38000U in April, earning 1200U;

April: Entered ETH at 2200U with a 30% position, increased by 20% in May, took profit at 3400U in June, earning 1800U;

June: Positioning quality altcoins (with practical projects), entered in 3 batches, took profits after doubling in August;

Result: In 8 months, funds increased from 3000U to 28000U, with an annualized return of 1100%. The core is 'go with the trend + long-term holding + strict risk control'.

Part Four: Beginner's Guide to Avoid Pitfalls - 90% of the losers I have seen have stepped on these landmines.

In ten years of trading cryptocurrencies and six years of teaching, I have seen too many people lose and exit due to stepping into pitfalls. Below are 8 pitfalls that beginners must avoid, and seasoned traders must remain vigilant about:

1. Pitfall 1: Chasing Highs and Selling Low - The most fatal 'Retail Investor Behavior'.

Performance: Following the trend to buy in when prices surge and panic selling when prices plummet;

Consequences: Always buying at highs and selling at lows, repeatedly getting harvested;

Method to Avoid Pitfalls: Only enter during 'trend confirmation + signal resonance', do not chase highs; if it breaks the stop-loss level, exit without panic selling.

2. Pitfall 2: Not Setting Stop Losses - Turning 'small losses' into 'huge losses'.

Performance: Not setting a stop-loss when entering, holding onto losses, thinking 'it will bounce back eventually';

Consequences: In a one-sided market, directly losing all principal (such as contract liquidations or spot price crashes);

Method to Avoid Pitfalls: Set stop-loss before entering, and once the stop-loss level is triggered, exit immediately, with no exceptions.

3. Pitfall 3: Heavily Leveraged Contracts - The 'Liquidation Tool' for Beginners

Performance: Thinking spot trading is slow to profit, using high leverage contracts for heavy trading, wanting to double quickly;

Consequences: While leverage amplifies returns, it also amplifies risks; a small fluctuation can lead to liquidation.

Method to Avoid Pitfalls: Beginners should resolutely avoid contracts, while experienced traders should limit leverage to no more than 3 times and positions to no more than 20%.

4. Pitfall 4: Trading on News - Others' 'Traps', Your 'Losses'

Performance: Believing 'insider information' and 'big shots' recommendations, following others to buy coins;

Consequences: News is always lagging. When you buy, it's when others are selling, making it likely you are the one left holding the bag;

Method to Avoid Pitfalls: Only trust your trading system, do not look at news or listen to recommendations, and make independent judgments.

5. Pitfall 5: Frequent Trading - 'Fee Assassins' will eat your profits.

Performance: Making dozens of trades in a day, believing 'more trades mean more profits';

Consequences: Frequent trading not only increases the chance of errors, but also fees will eat up most of the profits.

Method to Avoid Pitfalls: Daily trades should not exceed 3, if no signals are present, wait. It’s better to miss an opportunity than to make a mistake.

6. Pitfall 6: Greed for More - Trying to trade every coin, resulting in poor performance in all.

Performance: Holding dozens of cryptocurrencies at once, thinking 'if one doesn't work, another will';

Consequences: Dispersed energy, unable to track each coin's trend, missing out on quality coins, and possibly stepping on landmines;

Method to Avoid Pitfalls: Focus only on 3-5 cryptocurrencies (2 mainstream coins + 3 quality altcoins), conduct in-depth research, and operate repeatedly.

7. Pitfall 7: Emotional Trading - Feeling elated when making money, anxious when losing.

Performance: Blindly increasing positions after profits, thinking 'I am a god'; rushing to recover losses after losses, leading to even greater losses;

Consequences: Mindset collapses, trading logic falls apart, ultimately losing all profits or even principal;

Method to Avoid Pitfalls: Reduce positions after profits, stop after losses, maintain a calm mindset, treat trading as 'work', not 'gambling'.

8. Pitfall 8: Not Learning or Reviewing - Always 'repeating losses'.

Performance: After trading for years, still operating based on intuition, not summarizing experiences or reviewing trades;

Consequences: Each time you incur losses, you step into the same pit, never able to grow.

Method to Avoid Pitfalls: Create a trading journal, record the logic for each trade, stop-loss, take-profit, and profit-loss situations, review weekly, identify problems, and optimize the system.

Part Five: Long-Term Growth Advice - The Transformation from 'Making Money' to 'Sustained Profit'.

Trading cryptocurrencies is not a 'one-time buy and sell', but a long-term practice. To transition from 'occasionally making money' to 'sustained profit', you need to achieve these 4 points:

1. Respect the Market - Never think you can 'beat the market'.

The cryptocurrency market is highly volatile, and no one can predict market trends 100%. I've been in it for ten years, and there will still be losing trades, but I can maintain stable profits. The core is 'respecting the market and accepting losses' - losses are part of trading. As long as losses are within a controllable range, they won't affect overall profits.

2. Stick to Execution - The power of the trading system lies in 'strict execution'.

I have seen many students learn my system, but due to 'thinking this signal isn't good enough' or 'wanting to earn a bit more', they fail to execute, resulting in losses. The trading system itself is not the problem; the issue lies in execution - as long as entry conditions are met, enter decisively; as soon as stop losses or take profits are triggered, exit firmly without hesitation.

3. Continuous Learning - The cryptocurrency space is changing, and your system must also 'iterate'.

The market trends, policies, and funds in the cryptocurrency space are constantly changing. For example, the DeFi market in 2020, the NFT market in 2021, and the ETF market in 2024 all have different playstyles. You need to continuously learn, pay attention to industry dynamics, optimize your trading system, and make the system adapt to the market, rather than making the market adapt to your system.

4. Control Desires - The essence of making money is to 'earn within your cognitive range.'

Many people incur losses in cryptocurrency trading because 'desire exceeds cognition' - wanting to earn where they do not understand, wanting to double quickly and get rich. However, in reality, the amount of money you make depends on your cognitive level and trading ability.

Take it slow, one step at a time. First, ensure 'stable profits', and wealth will naturally follow.

Conclusion: Written for all cryptocurrency traders - The trading journey, walk fast alone, but walk far together.

After ten years of trading cryptocurrencies and six years of teaching, I transformed from a 'retail investor' who lost all savings into a 'mentor' who can lead students to stable profits. My greatest insight is: trading is not just a tool for making money, but a form of practice. It has taught me to respect the market, control my desires, and maintain rationality—qualities that are more valuable than making money itself.

The trading system and strategies I shared today are not 'get rich quick secrets', but as long as you can settle down to learn and execute, you can definitely avoid the pitfalls I have stepped into and achieve steady growth with small funds.

Remember: The core of trading cryptocurrencies is not 'how much to earn', but 'how long to survive' - only by surviving can you wait for the opportunity to make money.

If you encounter problems while trading or want to further refine a specific strategy, feel free to communicate with me at any time.

The trading journey is fast alone but far together. I hope we can walk more steadily and farther in the cryptocurrency space!