Methods can be accelerated, but understanding the market cannot be achieved overnight.
In my many years of cryptocurrency trading, the most commonly asked question is: “Can you teach me a few of the most profitable technical indicators?” Every time I hear this question, I can feel everyone's eagerness for quick success. But today, I want to sincerely tell you a truth: in trading, logic is far more important than technology.
Technology is just a tool to implement trading logic, while logic is the soul of trading. Technology without logical support is like a ship without navigation, destined to lose its way in the turbulent waves of the market.
Technology is 'Shu', a tool that can be used right away.
Let's face a fact: trading technology is not difficult to learn. Market prices either rise or fall; the price chart is merely a combination of a few basic shapes. Whether it's a head and shoulders, triangle, or wedge, these chart patterns can be found in any technical analysis book.
Technique is a methodology that can be standardized and taught. Look, the golden crosses and dead crosses of the MACD indicator, the overbought and oversold areas of the RSI, and the upper and lower band breakthroughs of the Bollinger Bands—these rules are clear and straightforward. A complete novice can master the basic uses of these technical indicators within a few days of study.
But the question arises: why do people who master the same technical indicators have vastly different trading results?
Logic is 'Dao', an understanding of the essence of the market
Logic is not a simple rule of 'if A then B', but a deep understanding of the market's operational mechanism. It determines what techniques you use in what market environment, and how to adjust when the market does not meet expectations.
For example, why do price retracements often occur after breaking through key positions? Technical analysis tells you this is a 'natural retracement' or 'washout', but logical analysis can help you understand: the breakout point is a position that the public is optimistic about, retail investors will rush in, while large funds will take the opportunity to exit. The trading volume expands at the breakout and then gradually shrinks, indicating that supply is gradually exhausted, and demand ultimately overcomes supply.
Understanding this logic naturally shapes your technique:
You can buy directly when a breakout occurs, setting reasonable stop-losses to prevent false breakouts.
You can buy when the retracement confirms the supply has been exhausted, this offers better cost but requires stronger judgment.
You can buy when the price breaks through the retracement high point again, which is the most friendly position for ordinary traders.
The same chart, the same trend, can derive various technical entry points due to different logics. This is the power of logic.
New changes in the crypto market in 2025: logic needs to be upgraded.
With the integration of AI and high-frequency trading, the crypto market in 2025 has undergone profound changes. The advantage of relying solely on technical indicators is rapidly disappearing.
Institutional investors have improved trade execution speed to the millisecond level with atomic clock synchronization and microwave tower networks. Ordinary traders who still fantasize about defeating the market with simple golden crosses and dead crosses are like going into a modern battlefield unarmed.
In today's market, emotional trading has gradually been eliminated; those who can truly seize opportunities are those who master AI computation, quantitative analysis, and efficient execution capabilities. Here, 'capability' is not just about technical skills, but also about the ability to understand the logic of market operations.
My personal experience: how logic changed my trading.
When I first entered the industry, I was obsessed with finding the 'holy grail' technical indicators, trying various complex formulas and systems. But what truly transformed my trading level was not discovering some magical indicator, but rather a profound understanding of market logic.
I remember during the significant market fluctuations in 2023, various technical indicators frequently sent conflicting signals. However, I realized that under the macro background of the Federal Reserve's policy shift, market liquidity expectations had fundamentally changed. This logical judgment allowed me to withstand short-term volatility pressure, maintain my long position, and ultimately achieve considerable profits.
This experience made me deeply realize: technology can help you find entry points, but logic is what allows you to hold onto your positions.
How to cultivate your trading logic?
First, clarify your trading type. Are you a day trader, swing trader, or long-term holder? Different trading styles require different logical foundations. Day traders focus on micro market structures and order book imbalances, while long-term holders pay more attention to fundamentals and long-term value.
Secondly, analyze the market from multiple dimensions. Successful crypto traders combine technical analysis, fundamentals, and sentiment analysis. Don't limit yourself to one analysis method, but build a three-dimensional market perception system.
Most importantly, constantly review and reflect. Every trade you make, whether profitable or not, is an opportunity to validate and correct your logic. Regularly review your trading records and ask yourself: does the actual market trend match my expectations? If not, why?
Conclusion: Logic is the root, technique is the foundation.
In the world of trading, technique is the steering wheel, while logic is the navigation system. A car without navigation, no matter how sensitive the steering wheel, is bound to lose its way.
Trading logic is the root, technique is the foundation; the two complement each other. But strong roots lead to lush leaves, and a solid foundation allows branches to flourish.
I hope my sharing can help you rethink the essence of trading. Let me know in the comments, do you pay more attention to logic or technique? Do you have any unique trading insights?
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