Rules are more important than luck, and discipline is more reliable than getting rich quickly.
Last week at a family gathering, my cousin excitedly waved her new phone at me and said, “Bro, I’m planning to buy Mom a gold bracelet next month!” This scene made me feel a lot. Six months ago, the same cousin was crying at my doorstep—she had followed her group friends to trade in 'hundred times divine coins', and her principal of 1800U shrank to 900U in half a month, and she was almost unable to pay the rent.
As an analyst who has been in the cryptocurrency market for five years, I have seen too many tragedies of small capital players. They either blindly follow the trend and go all in, or frequently trade in a volatile market, ultimately giving all their principal to the fee platforms. Today, I will share three core rules that helped my cousin achieve a turnaround, hoping to inspire you with the same small capital.
1 Three-part capital method, protect your lifeline
My cousin's biggest mistake at first was betting all her funds on one altcoin. When it went up, she was so excited she couldn't sleep; when it fell, she panicked and stared at the screen all night. The first thing I did for her was to divide the remaining 900 U into three parts, with each part being 300 U, each serving its purpose.
The first part is 'day trading capital', only operating on mainstream coins like Bitcoin and Ethereum, setting a profit target of 2%-4%, and exiting once achieved. In her words, 'As long as I earn a day's living expenses, I am satisfied, and I am less anxious.' This part now brings her stable earnings of several hundred U each month.
The second part is 'swing trading capital', not watching minute-by-minute charts, only focusing on daily level opportunities. We agreed that we must wait until the short-term moving average crosses above the long-term moving average and the trading volume significantly increases before entering. This part is the main source of profits; she caught two good swings, earning over 2,000 U in a single instance.
The third part is 'bottom line capital'. I strictly required her that even if the market plummeted by 50%, this money could not be easily touched. The existence of this money made her mindset much more stable while trading, preventing her from making wrong decisions out of panic.
The core of capital management is not to earn more, but to survive longer. Many beginners think about doubling their investment as soon as they enter the market, and as a result, they are often quickly eliminated by the market. The value of the three-part rule is that it ensures that no matter what happens, you have the capital to make a comeback.
2 Only eat the fish body, avoid consolidation traps
Most beginners have a misconception that 'not trading is wasting opportunities'. My cousin initially traded 3-5 times a day, and by the end of the month, she had lost over 100 U in fees, which was more than 10% of her principal.
I set a strict rule for her: without a clear signal of 'golden cross + volume increase', she should directly close the trading software. One time, she saw everyone in the group shouting to buy the dip, and I forcibly took her to watch a movie. The next day, when we looked again, those 'buying opportunities' had dropped another 15%.
The crypto market spends 80% of its time in consolidation, with only 20% of the time in trending markets. Smart traders should be like cheetahs, resting most of the time and only striking when opportunities are certain.
More importantly, after each profitable trend, a portion of the profits must be withdrawn to a secure wallet. I instructed my cousin to withdraw half whenever her profits exceeded 20%; this habit allowed her to accumulate more than 20,000 U in 'safe assets' over four months.
3 Use rules to control your hands, say goodbye to emotional trading
Initially, my cousin set a stop-loss point, but when the price actually fell to that stop-loss level, she always found various reasons not to execute: 'It has already fallen so much, it should rebound, right?' As a result, a small loss turned into a big loss.
Later, I helped her set three 'iron rules', requiring her to execute like a robot: First, if a single loss reaches 1.5% of the principal, stop loss immediately; second, if the floating profit exceeds 3%, reduce the position by half to lock in profits; third, never average down after a loss.
At first, she was very unaccustomed. Once, after a stop-loss, the price immediately rebounded, and she was so angry she stomped her feet. But I told her: 'What we want is long-term stable profits, not gambling on the outcome of a single market.' After a month of persistence, she finally understood the importance of rules — the money lost in the previous three months was earned back in a month, and she never had a liquidation.
Successful trading does not rely on accurate predictions but on winning through rules. Many people are obsessed with technical analysis but neglect the most basic discipline building. For small capital players, good trading habits are more important than accurate market predictions.
Now my cousin’s account funds have steadily grown to 60,000 U, and more importantly, she no longer has to stay up late watching the market and is no longer anxious due to market fluctuations. She joked, 'I used to always think about hitting it big, but now I understand that small capital is like planting a tree; it needs to be watered slowly and cannot expect to grow into a towering tree overnight.'
The crypto world has never lacked opportunities; what it lacks is the ability to survive. The most important thing for small capital players to give up is the 'gambling nature'. Instead of inquiring about insider information everywhere, it is better to calm down and establish your trading system.
Rules are more reliable than luck, and discipline is more sustainable than getting rich quickly. This is the core experience I summarized from my cousin's success story. I hope that you, who are reading this article, can also find your direction in the waves of the crypto world and move forward steadily.
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