The most stable way to play in the cryptocurrency contract
Choose the right coin and be a good person. As a leveraged trader, volatility can be amplified by leverage, and the primary consideration during trading is not volatility but certainty.
In a bullish market, go long on strong coins; conversely, in a bearish market, short the weakest coins.
For example, when a new quarter begins, the strongest performers are eos and eth, and the first choices for long positions during a pullback are these two coins. In a downturn, the first choice to short is Bitcoin, even if the final result shows that mainstream coins decline more than Bitcoin. However, only shorting or chasing Bitcoin can greatly reduce the risk of violent pullbacks.
Most participants in the cryptocurrency market are short-term traders, and it is difficult to hold on to ideal exit points during trading. They are also not very proficient in position control and cannot rely on oscillations to average down. Given this situation, for most traders, a good entry price outweighs everything.
Once there is profit, take some off the table for safety, and set the stop loss at the cost price for the remaining portion. This is something I have always emphasized.
The essence of contract trading strategies
(1) Identify the main trend and trade in the direction of the main trend; otherwise, do not enter the market.
(2) If you are trading with the trend, entry points:
1. New breakout points of the trend;
2. Breakout points of a sideways consolidation leaning towards a certain direction;
3. Pullback points of an upward trend or rebound points of a downward trend.
(3) Trading with the trend will bring you substantial profits; never exit early;
(4) If your entry aligns with the larger trend and your paper profit proves you are correct, you can perform pyramid-style technical averaging; (refer to point two)
(5) Keep your position unchanged until the trend reverses and you exit.
(6) If the market trend is opposite to your entry, cut losses and run.
In addition to adhering to the above strategies, remember three qualities: discipline, discipline, and discipline!
The way of trading is to accumulate little by little, with compound interest being king. If you stray from your cost base, you must not turn back into a loss. If you have made a profit, definitely take some off the table to prevent it from being in vain. In summary, in one sentence: If you have profit, be bold to go, and let the rest be at cost loss.
