The slightly downward sloping moving average is the true boundary that separates geniuses from gamblers in the crypto world.
I will always remember that late night, the green light from the screen reflecting on my face, the account's floating profit figures constantly jumping - I had already made 2 million. A voice inside was shouting, 'That's enough, it's time to sell!' But another louder voice said, 'Wait a bit longer, you can reach 3 million soon!'
As you guessed, three days later, not only did I not earn 3 million, but I also lost 1 million. That experience was like a slap in the face, waking me up from the dream of 'getting rich overnight.' After eight years in the crypto circle, I have seen too many genius traders go to zero overnight, and I have also seen ordinary retail investors survive the bull and bear markets through clumsy methods.
Today, I won't discuss complex indicators; I will share two survival rules that I learned through real money.
01 Lifeline Rule: If you're going to date the market, you must first ensure your survival.
The 70-day moving average is my lifeline. I now have to silently recite this phrase three times every day before the market opens. In the early days, I also believed in value investing; once, when an asset I held fell below the moving average, I stubbornly held on, constantly reassuring myself: "The big player is just shaking the market; it will rebound soon." As a result, my profits turned into losses, and after losing 30%, I had to sell at a loss. That heart-wrenching feeling is like being robbed in front of others and not daring to retaliate.
Later, I set a strict rule for myself: any asset that falls below the 70-day moving average must be sold immediately, without mercy. This rule is so simple that even beginners would laugh, but it has helped me avoid countless crashes.
During last year's mainstream coin flash crash, I cleared everything in an instant as it broke the line, and that afternoon it dropped 25%. There was another time when a small coin broke down, and I decisively left the market, only to watch it halve over and over again. This rule is not 100% accurate, but it can help you avoid 80% of deep drawdown risks.
The market never cares about your feelings, nor will it show mercy just because you are reluctant to let go. In the crypto world, the more ruthless the rules, the greater protection they can provide you.
02 Step-by-step Profit Taking Technique: From "greedily eating the whole cow" to "diligently nibbling on a few legs."
Another strategy that helped me avoid losing millions is the "inverted pyramid profit-taking method."
Now my trading discipline is: sell half when it rises by 30%, secure the principal; sell the remaining half when it rises by 50%; finally, leave 10% of the position to fly freely. This method might seem outdated, but it is genuinely practical.
I used to be a "greedy snake", always wanting to eat from start to finish. Once, a heavily invested coin rose by 40%, and I refused to sell, dreaming of doubling my investment. As a result, in three days, my account fell from a 40% profit back to the breakeven point, and I ended up losing money. That day, I stared at the candlestick chart and suddenly realized: unrealized gains are just money borrowed from the market; only after taking profits is it really yours.
Now, when I see beginners asking, "Should I sell after a 20% rise?", I always think of my past self. My experience is: taking profits is never too early; the market is never short of opportunities, but it's lacking those who can steadily pocket the profits.
Look at those data; when the investment portfolio has an unrealized gain of over 50%, the probability of a return of over 15% in the next month exceeds half.
Those who stubbornly hold on to the end mostly end up on a roller coaster.
03 The essence of survival in the crypto world: surviving is the hard truth.
The longer I stay in the crypto world, the more I understand one truth: the biggest contradiction in this market is not the struggle between you and the market trend, but the confrontation between you and your own greed and fear.
Data shows that low-frequency traders have an annualized return of 18.5%, which is higher than high-frequency traders' 11.4%.
Those who operate frantically every day ultimately get harvested by fees and market fluctuations.
A capable trader does not catch the maximum rise every time but knows when to decisively let go. As an old trader said: "My secret to making money is not buying well, but running faster than anyone else when it's time to flee."
The crypto market operates 24 hours, opportunities are always present, but your principal is limited. Why do 90% of people ultimately lose money? Because they turn infinite opportunities into limited gambling.
Now, every time before I place an order, I open my phone's memo and look at the history of my painful experiences: "September 2022, due to not stopping losses in time, I lost 600,000 in a single day." This string of numbers is more effective than any master class.
True trading experts know how to quietly exit when others are celebrating and calmly enter when the market is in panic. Remember, it's not you who chose the market; it's the market that chose the survivors.
Are you ready to be that survivor? Follow Xiang Ge, and let him guide you to understand more first-hand information and precise points in the crypto world. Learning is your greatest wealth!#加密市场反弹 #美联储降息 $ETH
