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To make money in the crypto world, it's never about luck or impulsiveness. Those who consistently profit often master a set of seemingly simple yet sustainable "foolproof methods." The key lies in thoroughly understanding the underlying market logic.
Let's start with three things you must never do:
**First Pitfall: Chasing the Market When Prices Surge**
Real opportunities don't come during frantic market peaks. During market panic, you need the courage to go against the trend; when everyone is frantically chasing gains, stay calm. Embed "buy on dips" into your trading instincts.
**Second Pitfall: Randomly Placing Orders**
Once you place an order, your funds become passive, losing flexibility to adjust. Reacting to market changes becomes difficult, and you risk getting caught in a trap.
**Third Pitfall: Full Position Trading**
The risk of going all-in is that you have no power to respond to any fluctuations. Even more painfully, you'll miss out on new opportunities that keep emerging. The opportunity cost is often more valuable than the small profits you make now.
Now, here are six practical principles for short-term trading:
1. **The Pattern of Sideways Consolidation at High and Low Levels**:
After a high-level sideways move, the price is likely to surge to a new high; after a low-level consolidation, it often tests new lows. But don't rush to buy; wait until the trend direction is clear before acting.
2. **Most Losses Happen During Sideways Markets**:
Many traders lose money because they don't stick to this rule—don't make reckless moves during sideways periods.
3. **The Rhythm of Candlestick Patterns**:
Buy on dips when the daily candle closes bearish; sell when it closes bullish. This rule has stood the test of time.
4. **The Pace of Declines Is Critical**:
When declines slow down, rebounds tend to be slow as well; but if the decline accelerates suddenly, the rebound can be even more vigorous.
5. **Pyramid Building**:
Start accumulating gradually from low levels; this is a timeless strategy in value investing.
6. **Signals of Trend Reversal After Sideways Movement**:
After a currency experiences continuous rises and falls, it will inevitably enter a sideways phase. During this time, avoid selling all at high levels or buying all at lows. Once a trend reversal occurs (e.g., from a high downward), liquidate immediately.
The rules of the game in the crypto world are like this—those who make money are mostly not bold, but follow these seemingly ordinary principles.
Sideways trading is really a trap; doing nothing is the best strategy.
I agree with the idea of contrarian positioning, but few people actually dare to do it.
Building a pyramid position is indeed reliable; averaging down in stages is the safest approach.
After hearing a bunch of principles, the key is to have discipline, otherwise it's all pointless.