In the same crypto trading circle, some people turn 5,000 yuan into 1 million in half a year, while others lose 500,000 yuan in a day. It seems to be a matter of luck, but in reality, the difference lies in the understanding and execution of position scaling rhythm. I have been trading and struggling for 4 years, and my final takeaway boils down to two words—"守" (guard) and "狠" (be ruthless).

Most people's dilemma is quite typical: 90% of the time they are blindly messing around in the market, while the 10% of the time when the market actually moves is often missed. Even more painfully, many fall into a dead cycle of "small profits and then run, big losses and stubbornly hold," without ever thinking about why this happens. The answer is actually hidden in technical rules.

I myself went from frequent margin calls to being able to earn 3 times the profit in a single trend, relying on five ironclad technical rules. Today, I will break down these practical details so you can directly apply them.

**Rule 1: The 20-day moving average is your life and death line**

Crypto trading doesn’t require you to predict market direction; you just need to be on the right side. Using a 20-day moving average can automatically separate bullish and bearish trends. When the price is above the moving average, only go long. When it breaks below, only go short. It’s that simple.

Taking Bitcoin in 2023 as an example. When it stabilized around the $30,000 mark and the 20-day moving average held, the price then surged to $48,000. Throughout the process, you only needed to go long—no fuss. But many people can’t withstand short-term fluctuations, and when they see a few dips, they cut their positions, ultimately missing out on the big trend.

Short-term noise doesn’t matter at all. A true trend reversal only occurs when the price closes on the opposite side of the moving average for three consecutive days. Ethereum oscillated around $2,000 for a long time but remained above the 20-day moving average, indicating that the bullish logic was still intact. You should stick to going long, rather than being scared out by oscillations.

From a technical perspective, the 20-day moving average filters out 80% of invalid fluctuations. Instead of watching the K-line jitter for 12 hours, it’s better to use this line to automate your trading. During the 2024 SOL decline from $100, just by observing the position of the moving average, you would know how to respond.