Stop asking 'how not to lose in the crypto market'! Last week, I was kicked out the door by an old fan late at night, and his face was darker than the K-line that crashed in the early morning. Clutching the remaining 1200U, he said to me: 'Bro, if I fall again, I’ll have to go count stars under the bridge.'
I've seen too many retail investors crash and burn from FOMO chasing highs and going all-in. I'm too lazy to talk about the cliché saying 'respect the market,' so I'll just throw him 3 pieces of 'anti-human nature principles' that I've summarized from 6 years of struggle. After all, in this attention economy-driven market, surviving is a thousand times more important than making quick money.
First sentence: Divide the principal into three tiers; never go all in.
This is the easiest operation I've ever seen that can cause retail investors to crash, betting everything on a single target. If you win, you soar to the heavens; if you lose, you go straight to zero. My approach is to divide the principal into three equal parts, each with a clear 'mission':
Short-term flexible position 30%: Treat it as 'tuition fee pocket money' paid to the market. Only do 1-2 short trades a day, and stop when you've reached your target; no matter how much it skyrockets afterward, never look back. Many people fail because of greed, always thinking about earning one more point, only to end up losing all their principal.
Trend layout position 30%: Only enter when you recognize trend signals at the weekly level. When there's no activity, treat this money as 'fixed deposits'; don't keep staring at the screen, unnecessarily fidgeting. One target I previously laid out, I held onto for a full two months without touching it. The volatility in between made me want to curse, but in the end, the profit tripled.
Emergency supplementary position 40%: This is your 'life-saving money', only to be used in extreme situations, close to the stop-loss line. The purpose is not to catch the bottom but to help you maintain your qualification at the table. Remember, you can recover from losing a finger, but losing your head means there's no chance left.
Second sentence: Only take the 'free ride'; learn to 'play dead' during volatile periods.
The biggest temptation in the crypto market is the lure of quick profits. Today, this meme coin skyrockets by 200%, and tomorrow, some new project claims 'hundred times expectations'. But most of these are traps set for retail investors. My trading rule is simple: only trade in deterministic markets.
What is a deterministic market? A strong breakout above previous highs + a bullish daily candle. Only when both signals are satisfied should you consider entering the market; both are necessary. Also, after entering, you must set a 'profit protection': once you've made 30%, take half of the profits to a safe wallet, and set a 10% trailing stop on the remaining part, so even if the market reverses, you can keep most of the profit.
As for those ups and downs during 'waste time', my advice is to just close the software. Instead of staring at the screen and making foolish moves, go walk the dog, watch a show, or spend time with family. After all, 80% of trades in a volatile period are losses; less action is a win.
Third sentence: Lock in emotions and turn trading into 'mechanical operation'.
90% of losses stem from emotional control issues: seeing others make money leads to FOMO chasing highs, while encountering a drop results in panic selling; this is a common ailment among retail investors. The method I taught Lao Bai is to 'write a life-and-death statement before trading':
Before entering the market, clarify your stop-loss line; my personal standard is -3%, which triggers automatically. Never hold onto the fantasy that 'if I wait a bit longer, it will go up'; set fixed trading times: shut down the computer at 11 PM sharp, no matter how exciting the market is. If you can't sleep, uninstall the trading app, and reinstall it the next day. After each trade, write a review note, regardless of profit or loss, to clarify why you bought and why you sold.
Many people feel that such trading is too dull, even wanting to yawn, but it is precisely this kind of boring discipline that allows you to thrive in the market. The crypto market is not a casino; money earned by luck will eventually be lost by skill.
After 90 days, Lao Bai sent me a screenshot showing that 1200U had turned into 52000U, with zero crashes in between. He excitedly asked if I wanted to add to my position for a big wave, and I replied with just one sentence: Don't get carried away! There are opportunities every day, but the principal is just this one; protect the principal, and you'll always have a chance to earn more.
In the crypto market, those who can make money are never the biggest gamblers but those who know how to control risk and maintain discipline. I've seen too many cases fall from millions back to zero, and I've helped many retail investors establish the right trading mindset.
