Discipline and patience are more reliable than the myth of getting rich quickly.
Last Sunday at 2 AM, I received a voice message with a crying tone. Xiaoya, who has been following me for three years, was almost in tears, saying: 'Brother Chen, my husband has invested all our family savings along with credit card cash advances, and now there is only a tiny amount left in the account. We don’t even have the money for the baby formula next month. I really want to jump off the balcony.'
I immediately called her back and listened to a tragedy that should never have happened. Three months ago, Xiaoya was pulled into a 'crypto get-rich-quick group' by a neighbor and blindly invested in a token with a white paper that was vague at best. Initially, she made a 20% profit which made her let her guard down, even increasing her investment, until that morning when she opened the trading software and saw that two zeros had disappeared from the numbers; only then did she realize she had fallen into a scam.
Before the call ended, I told her: 'Money can be earned back, but you must first understand that the crypto market is not a casino, but a battlefield. Casinos rely on luck, while battlefields rely on discipline.' Later, I shared with her the six survival rules I summarized from my experiences in the crypto market. Six months later, she not only made up for her losses but also saved an education fund for her child. Today, I share these experiences without reservation, hoping to help you avoid detours.
1. Volume-Price Correspondence: See Through the Market's 'False Moves'
Prices can lie, but volume cannot. This is my deepest insight from ten years of market observation. Many beginners focus solely on price fluctuations, neglecting that volume is the core indicator that truly reflects market sentiment.
I have summarized a simple rule: rapid rises and slow declines usually indicate that the main force is quietly accumulating, while rapid declines and slow rises often indicate that the main force is offloading.
I remember a popular token last year that surged 150% in three days, and everyone in the groups was shouting 'new historical high.' But I noticed a detail: as the price rose, the trading volume continued to shrink. I immediately told my friends to liquidate. Sure enough, the fourth day began a cliff-like decline. An increase without volume support is like a rocket without fuel; it can't fly high or far.
Conversely, if a coin suddenly plummets but the trading volume has not increased, and then gradually rebounds with decreasing volume, it is very likely that the main force is washing the market, and there is no need for panic selling.
2. Responding to Flash Crashes: Don't Catch the 'Flying Knife'
The most painful case I have seen was when a platform experienced short-term volatility last year. Someone saw a mainstream coin suddenly drop 30%, immediately bought in with all their funds, and ended up being forcibly liquidated that day. A flash crash is not an opportunity, but a warning.
The rebound after a flash crash is often a 'trap for the greedy.' The main force scares retail investors out of their positions by rapidly smashing the market, then slightly raises the price to attract bottom-buying funds, and continues to sell. The correct approach is: after a flash crash, observe for at least 24 hours to determine if the project itself is problematic or if it is simply market volatility. Once stability is confirmed and volume rebounds, then cautiously test with a small position, never easily 'catch the flying knife.'
3. High-Level Sideways Trading: Beware of the 'Boiling Frog'
Many people believe 'the longer the horizontal, the higher the vertical,' but I have seen too many investors who entered the market during high-level sideways trading ultimately become 'guarding soldiers.' The essence of high-level sideways trading is that the main force is quietly offloading.
A token from the year before last traded sideways at a high for 18 days, with daily fluctuations not exceeding 5%, and the group was filled with voices saying 'it's stable, it's going to take off.' But I noticed its trading volume was decreasing daily, and large sell orders were continuously increasing. I warned everyone to be cautious of this 'boiling frog' trend. A week later, the token plummeted 60%. Remember: if a high-level sideways trading lasts more than 7 days and volume continues to shrink, exit as soon as possible.
4. Bottom Confirmation: Patiently Wait for 'Double Verification'
The most common mistake beginners make is thinking that a single volume increase is a bottom, only to end up buying halfway up the mountain. The method I taught Xiaoya is: look for signals during the first volume increase, and wait for a decrease in volume before entering.
The true formation of a bottom usually requires two stages: first, a volume increase indicating that funds are starting to enter; then, a consolidation phase where volume gradually decreases, indicating that retail selling pressure is easing; when a second volume increase occurs and breaks through the consolidation platform, it is the real entry time. At the end of last year, I successfully positioned myself in the bottom area of a certain mainstream coin based on this principle, achieving an 80% return in three months.
5. Authenticity of Volume: Penetrating the Market Fog
Some small platforms now 'draw K lines' by manipulating prices in the background to create beautiful charts, attracting retail investors to take over. In this case, discerning the authenticity of volume becomes crucial.
My method is simple: pay attention to the trading volume on mainstream exchanges and the on-chain transfer data simultaneously. If a token performs spectacularly on a small platform but has light trading on mainstream platforms and no large on-chain transfers, it is likely a scam. Remember, K lines can be fabricated, but real trading volume is hard to disguise.
6. Mindset Management: Ruthlessness is the Highest Level of Trading Skill
This point is the easiest to overlook but also the most important. I have seen too many people with decent technical analysis skills ultimately defeated by 'greed' and 'fear.'
I set strict discipline for myself: when profits reach the target, I take partial profits, usually clearing 50% first; if the preset stop-loss line is breached, I decisively exit, without harboring any lucky thoughts. When Xiaoya initially executed this, she hesitated to sell after making 15%, so I called her to urge her to follow the plan. Later, that coin dropped by 40%, and she truly understood the meaning of 'locking in profits.'
Learning to wait with a vacant position is equally important. Last year, when the market was generally sluggish, I stayed out for four months, watching people in the group continuously 'buy the dip' and incur losses, while I patiently awaited certain opportunities.
Last month, Xiaoya messaged me saying she now only invests 20% of her spare money, spending half an hour each day analyzing the market, and the rest of the time with her child, baking. With a calm mindset, her investment returns have stabilized. The essence of the crypto market is not to get rich overnight, but to maintain a steady flow.
To survive in this market, one must adhere to a core principle: protect the principal with discipline, and wait patiently for opportunities. The crypto world is never short of opportunities; what is lacking are smart people who can live longer.
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