Diversification, rest, execution; it's easy to say but hard to do.
Do you remember the newbie I mentioned in the circle two months ago? Back then, he entered the market with 2400U, and now his account has steadily reached 170,000U. The most surprising thing is not the profit, but that he never had a liquidation throughout the process.
In the highly volatile cryptocurrency market, this is much harder than making quick money in the short term. Today, I'll share with you the simple yet effective three-layer logic behind this, which is experience I've gained with real money.
01 Put a 'bulletproof vest' on the funds
The less money there is, the more people tend to gamble. There's always a feeling that with less principal, one has to take a risk, but this mindset is precisely the recipe for rapid liquidation.
The first thing I asked this novice to do is to 'insure' the principal. This is risk management through position sizing, and it is the most basic form of risk control.
How exactly should this be done? Absolutely do not go all in at once. His 2400U was divided into three portions:
Exploratory position (800U): Used to test market direction and gauge the temperature.
Main position (1200U): Only invest in batches after a clear trend emerges.
Emergency position (400U): This is the 'lifesaver' money that must remain untouched, used to cope with extreme market conditions or as a reserve for opportunities.
The core purpose of position management is not to earn more but to survive longer. It ensures that even if you misjudge, you still have the ammo to regroup and attack again, and you will never be knocked out with a single blow.
Many novices fail by going all in; this is not bravery, but cutting off their own escape routes.
02 Most of the time, the market is just 'testing patience'.
The cryptocurrency market never closes, but that does not mean you need to trade 24 hours a day. Most of the time, the market experiences meaningless fluctuations, and true trending opportunities are rare.
My second iron rule for him is: If there is no obvious trend, stay out of the market and rest.
Frequent trading is a major taboo in leveraged contracts; it not only constantly erodes the principal but also disrupts one's mindset. This novice has spent over half of the past two months in a state of either being out of the market or with very light positions. It requires tremendous patience to resist the urge to trade impulsively.
Our strategy is to wait like a hunter. Understand it before taking action. Opportunities are to be waited for, not searched for. Give up on those mediocre trades that can be done or not, and only strike when you're most confident and the risk-reward ratio is optimal.
In the cryptocurrency space, waiting is a strategy in itself; observing can also be profitable.
03 Treat yourself as a 'machine' that executes commands.
This is the most counterintuitive and also the most difficult part. It’s easy to judge direction, but the hardest part is to stick to the rules.
I set several 'iron rules' for him that cannot be challenged: do not think during operations, just execute.
Unconditional stop-loss: for any trade, if the loss reaches 2% of the principal, exit unconditionally. Do not harbor any lucky thoughts, do not 'wait and see'.
Active profit-taking: When floating profits reach 4%, first reduce the position by half to lock in half of the profits. Set a trailing stop for the remainder to let profits run and avoid rollercoaster rides.
Never average down: absolutely do not add margin to a losing position to lower the cost. A loss is a mistake, and one must acknowledge it.
Big money trades are often very 'boring'. Opening positions, holding them, and closing them according to plan, with no dramatic back-and-forth operations. Successful trading is a systemic victory, not a stroke of luck from a single judgment.
This novice managed to grow 2400U to 170,000U without ever being liquidated, not by extraordinary skill, but by adhering to these most basic and 'down-to-earth' principles. In the cryptocurrency space, longevity is the only secret to ultimate success.
Position management, learning to be out of the market, and strictly following the rules—these three points are my core advice to all traders, especially novices. The market will never lack opportunities; what is lacking is capital and a clear mind. Follow Brother Bin to learn more firsthand information and precise points in the cryptocurrency space; education is your greatest wealth!#BTC走势分析 #美国伊朗对峙 $ETH
