I made 32 million in the last bull market. Let me share my experience of making my first bucket of gold in the cryptocurrency world.
I originally did e-commerce in Shenzhen, earning 20,000 to 30,000 a month, with monthly expenses over 10,000, saving about 10,000 to 20,000 each month. Like many 'Shenzhen drifters,' I also wanted to buy a house in Shenzhen. However, with this income level, I didn't know when I would be able to save for a down payment. My work income had bottlenecks, and it was hard for my salary to increase.
It was not until I got involved in the crypto world that I realized I could use the leverage of virtual currencies to multiply my assets! I was lucky to meet several good teachers when I entered the crypto world; they were truly my greatest fortune and my benefactors! At that time, I used most of my savings to bet on digital currencies, heavily buying ETH, along with a small amount of BTC and some miscellaneous altcoins. I added to my positions during several major pullbacks and then hardly operated anymore. Even when there were significant crashes, I did not run away but added to some promising altcoins.
Until November 2021, Bitcoin broke its historical high of 69,000 USD. At that time, market sentiment was very high, and many believed it would break 100,000 USD; however, 69,000 was actually the highest point of this bull market. By the end of November, I observed that the overall trend was weakening and inferred that the bull market had likely ended, so I cleared most of my positions. At that time, Bitcoin was around 58,000, and Ethereum was around 4,400.
History has proven that this is a very wise choice, while some retail investors with 'bullish fantasies' calling for 'eternal bull markets' and clinging to 'tail-end rallies' have now been trapped. After the bull market in 2021 ended, my fund account had about 22 million RMB. I took out 4 million for a down payment to buy a house in Shenzhen (I changed my household registration to Shenzhen after graduation, and after paying three years of social security, I qualified to buy a house), 2 million for daily use, and left 26 million in the exchange.
Regarding compounding in cryptocurrency trading, I'll share my personal experience: The first 10 million took the longest and was the hardest, involving trading systems and continuous reshaping, taking a year and a half. The second 10 million took three months. The third 10 million took only 40 days. The fourth 10 million took just 5 days. 75% of the funds were earned in the last six months. I truly understand the power of compounding as explained by the old man Feite. To summarize what I did well: I have a very simple trading method that allows you to maintain 'ever-profitable.' At the end of last year, I played with 200,000 and now have 20 million, easily achieving a hundredfold profit. The experience is summarized below for everyone to reference and learn; making money from trading is actually this simple, just need these three steps! Master them, and you can easily multiply your account by ten times!
Step 1: First, look at the trend.
Step 2: Find key levels again.
Step 3: Find entry signals. Enter, take profit, close the position, and leave. Isn't it simple?
Let me explain in more detail below.
Step 1: First, look at the trend. The state of a market can result in three outcomes: rising, sideways, or falling. What is a major trend? Look at the 4-hour or longer cycle charts, such as 4-hour, daily, or weekly (my personal habit is to look at the 4-hour). If it rises, go long; if it falls, go short. Do not trade in a sideways market.
Step 2: Look for key levels. Whether the market is rising or falling, it will jump like a bouncing ball, level by level up or down. What we need to do is enter at the point where it jumps, and exit at the next landing point. Finding precise steps becomes crucial. Bitcoin, which we call key levels (main support and resistance levels).
Step 3: Look for signals. Generally, if you discover a trend in a large cycle, you should look for trading signals in a smaller cycle to enter. Everyone has their own preferred strategies; mastering one or two is sufficient. What matters more is quickly formulating trading strategies, along with a complete trading strategy.
(1) Underlying asset - what to trade;
(2) Position size;
(3) Direction - long or short;
(4) Entry point - at what price to trade;
(5) Stop loss - when to exit a losing trade;
(6) Take profit - when to exit a profitable trade;
(7) Countermeasures - how to deal with emergencies;
(8) Operations after the back-end trading ends. Also, when withdrawing money from the crypto world, pay attention to a few points to effectively prevent your account from being frozen when withdrawing cash.
(1) For OTC trading, try to choose large platforms like Binance and OKEx. These platforms have good communication channels and risk control measures with mainland regulatory and enforcement agencies.
(2) Try to choose OTC platforms that support T+1/T+2 withdrawal strategies. Although cash cannot be withdrawn immediately after selling coins, it reduces the risk of being implicated in money laundering through OTC transactions. For example, trading on Binance with T+1, and Huobi's strict selection (compared to free trading, T+2 withdrawals).
(3) Avoid using stablecoins like USDT for OTC trading; try to use mainstream coins like BTC and ETH for OTC transactions.
(4) The bank card used for OTC trading must be a separate card and not used for normal transactions, so it should be separate from the salary card. This way, even if it gets frozen, it does not affect the use of other funds. Investigations can easily explain cash flow.
(5) Try to use local bank cards for OTC trading, such as city commercial banks and rural commercial banks in many places. Large and medium-sized commercial banks and joint-stock banks with branches all over the country, like Agricultural Bank and Industrial Bank, can be directly frozen by law enforcement.
(6) Do not conduct regular transactions with ordinary merchants, nor with ordinary users. If the same user makes indirect purchases more than three times in a day or sells just a few hours after buying, it is suspected of money laundering, which is very dangerous.
(7) Look for reliable OTC sellers for transactions. Actively accept orders from large traders and market makers to reduce order placements and avoid merchants from problematic areas. In fact, as a regular user, it is difficult to differentiate which traders are trustworthy. For example, friends who have dealt a lot with Huobi Blue Shield merchants have also been frozen.
(8) Reduce the frequency of withdrawals and increase the cash amount.
(9) After OTC trading, please do not switch to your other bank cards to avoid contaminating other funds and causing trouble for the investigation. If you urgently need money, you can withdraw cash via an ATM or spend online.
(10) Try to choose weekdays to withdraw cash. It is best to conduct transactions during normal working hours like 9:00 AM to 9:00 PM.
(11) Please do not transfer funds immediately after receiving payment. After selling USDT for RMB, do not transfer it out immediately; keep it in the account for a while.
After 10 years of trading cryptocurrencies, I've summarized it into 16 sentences to share with everyone. Forward this to your friends who trade cryptocurrencies; they will definitely benefit for life!
1. Buy altcoins in a bull market, buy BTC in a bear market.
2. Coins with increased volume at the bottom should be given special attention, as they often signal a launch.
3. When a coin in an upward trend pulls back to important moving averages, it is a buying opportunity.
4. Do not trade frequently; making a few big trends a year is sufficient.
5. Control your position well; never go all in; leave yourself some room.
6. It is wise to stop losses on worthless coins rather than averaging down.
7. News can only serve as a reference; do not use it to make speculative bets.
8. Do not touch unfamiliar coins; focus on the sectors you are familiar with.
9. Do not be influenced by market sentiment; maintain calmness and rationality.
10. Altcoins that have risen too much will definitely fall; those that have fallen too much may not necessarily rise. Choosing wisely is important.
11. When most people are optimistic, it is often when the risks arise.
12. Learn to stay out of the market and wait for clear signals before entering.
13. Do not follow the crowd to speculate on hot topics, as they often come quickly and leave just as fast.
14. When trading, you must have your own trading system and execute it strictly.
15. Investing is a long-distance race; maintaining a good mindset will allow you to smile until the end.
16. Investing does not guarantee profits; there is a high probability of losses. Therefore, try to invest spare money. Using spare money to invest will give you a good mindset, and the probability of winning will increase.
Trading full-time has its ups and downs; what really makes money is seizing these two bull markets!
1. The risk of each trade must not exceed 10% of the trading principal; for beginners, it is advisable to keep it between 2%-5%!
2. After entering the market, do not blindly close positions due to lack of patience. The unfolding of the market takes time; before the market proves your operation is wrong, you must have sufficient confidence and patience.
3. Must execute according to plan; overtrading is strictly prohibited.
4. After trading correctly and making a profit, use the method of adjusting stop-loss and take-profit as a safeguard, boldly aiming for greater profits until the trend changes.
5. After entering the market, do not casually cancel your stop-loss orders. Once you enter the market, your whole trading process follows you for life; it is a process of controlling risk. Therefore, after entering, you must set protections. Naked trading is strictly prohibited.
6. Avoid adding costs after trading goes smoothly, that is, avoid adding positions.
7. You cannot casually switch from a long position to a short position; this is a high-skill operation.
8. When buying and selling goes smoothly, do not casually increase your position, as the probability of making mistakes is very high because you become complacent.
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