Last autumn, I bought a certain cryptocurrency, which initially rose by 5%, but then the next day it fell by 8%. I thought, 'I'll wait a bit, maybe it will go back up,' so I didn't sell. As a result, on the third day it fell by 10%, and I still didn't sell, until the fifth day when it fell by 15%. I finally couldn't help but sell, losing 1200 yuan. I slammed the table and cursed myself: 'Why are you so stubborn?'
Later I read (9 painful experiences in the cryptocurrency world), and I finally understood that stop-loss is something 'self-set, and profits come from the market's grace.' The book says: 'If the market cannot compensate for the previous day's cost the next day, you must stop-loss immediately and leave the market without hesitation. This is the bottom line for long-term survival in the cryptocurrency world.'
I set 'three principles for stop-loss' for myself:
① Set a 'hard stop-loss': Before buying cryptocurrency, set a stop-loss line of 5%-8%. For example, if you buy cryptocurrency worth 1000, sell it when it drops to 920 without hesitation.
② Do not 'hold the position': If the price drops to the stop-loss line, sell immediately regardless of the reason. Even if it rises again after selling, it is better than losing everything.
③ Do not 'averaging down': If the price drops, do not think about 'averaging down to reduce costs.' Unless you are sure that this cryptocurrency can rebound, averaging down will only increase your losses.
Last month, I used this method to buy a certain cryptocurrency. I sold it when it dropped by 7%, losing 350, but at least I didn't 'hold the position.' Later, the cryptocurrency dropped another 10%, and I was glad I 'stopped the loss in time.'
There is a saying in the cryptocurrency world: 'Stop-loss is not a loss, but a gain of the opportunity to avoid losing more.' If you want to learn how to 'stop-loss,' feel free to follow me.@币圈罗盘 I will share the specific settings for the 'stop-loss line' every day, so we can 'lose less money and make more money' together. Next time, I will tell you the story of how I avoided a loss of 5000 by using the 'stop-loss method,' remember to check it out~
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