In the cryptocurrency world, a field full of opportunities and challenges, many are seeking the secret to profit.

I have always strongly recommended significantly increasing and decreasing positions to enhance returns and mitigate risks. This method is fundamentally different from those who always hold full positions, are blindly optimistic, and can only leave their fates to chance after buying.

Position management is by no means just simple capital allocation; its implementation is based on a deep analysis of the macro economy and a solid accumulation of precise judgments on the cryptocurrency market trends.

In fact, position management has another well-known name - timing. After years of struggle in the cryptocurrency world, I finally feel that I have enough experience and insights to write an article on how to accurately time the market in the crypto space. This can be seen as a reward for my years of relentless effort.

I am not someone who is diligent and persistent in everything; in studies, basketball, and learning instruments, I often have a short-lived enthusiasm and quickly lose interest, making me a typical 'slacker specialist'. However, in the matter of investing in cryptocurrencies, I have persisted for over a decade and have always given it my all.

In addition, starting from the second half of 2023, I began sharing my investment experiences and insights on Zhihu, and I have now written nearly 2 million words, which is a small achievement for me.

Ultimately, in the cryptocurrency market, there are mainly three states of position management:

First, when very optimistic about the market outlook, choose to fully invest;

Secondly, when the market direction is not optimistic, decisively emptying positions and leaving the market;

Thirdly, when the market situation is vague and difficult to judge, also choose to stay out of the market and observe.

These three states seem simple, but they contain profound knowledge. To elaborate further, when in a fully invested state, if the cryptocurrency market rises sharply but the trend line starts to deteriorate, and negative news emerges continuously, the reliability of the investment decreases, and I will gradually liquidate my positions.

Of course, I won't clear positions with one click as I would in a simulated account; I usually spend 2 to 4 days gradually reducing my positions to zero.

Similarly, when the downward trend of the market gradually slows down and positive news begins to emerge, I will also gradually increase my positions from empty to full within 2 to 4 days. From an operational perspective, it's that simple.

However, in stark contrast to the simplicity of operations, is the complexity and difficulty of market judgment. Accurately determining whether the cryptocurrency market is strengthening or weakening requires a comprehensive application of technical analysis methods, accurately grasping the macroeconomic rhythm, gaining insight into market sentiment cycles, considering the overall valuation level of the market, and conducting in-depth research on the true value of individual cryptocurrencies, among other factors, to make a comprehensive and all-encompassing judgment.

This kind of judgment is highly subjective and cannot be quantified with specific data. Moreover, even considering so many factors, the actual success rate of the judgment is not very high.

Fortunately, we trade infrequently, and only act when we have a strong grasp of market trends, so overall, achieving profits is not difficult. When the judgment is correct, we can reap positive returns; and when the judgment is wrong, in most cases, it is just missing the opportunity.

Looking back carefully, there were actually very few cases of incorrect judgment in choosing the timing for bullish buying. After August 2023, it was a relatively obvious mistake. At that time, after the trend line broke, I did not leave the market in time, resulting in a significant loss of the previously accumulated profits.

However, during the subsequent review process, it is clear that at the point where the trend line broke, decisively reducing positions was the best response strategy. This also shows that my control over position management at that time was not mature enough.

The core of trading is to take certain losses to seek unlimited returns.

Don't treat price as a target, or view the fluctuations in front of you as everything. However, real profit is not dependent on short-term volatility, but on the skills you learn and the experience you accumulate through every rise and fall. Therefore, don't consider chasing the rise as a way to make money; I have seen that those who follow the trend are all just fodder. The real winners are those who silently accumulate experience in the low valleys because they know opportunities will eventually come. Don't treat emotions as strategies, and don't let momentary impulses ruin your chance to make big profits. You must first learn to calm down and formulate your strategy, and not let market emotional fluctuations affect you. Real profit is not an explosive moment but a calm analysis and precise action.

Chen Xi only does real trading, the team also has positions to get on the bus speed come$BTC #新手小白 #新手必看