Survival Rules for Each Stage in the Cryptocurrency Market from 10U to 10000U:
1. New to the Cryptocurrency Market (10U Survival Rule)
Strategy: Low-cost experimentation and market learning
Advice: Treat this 10U as a learning cost, which can be used to participate in some low-cost activities or projects. For example, try small spot trading, choose cheaper cryptocurrencies, and use small amounts of capital to experience the trading process and market volatility. Alternatively, focus on some free resources for learning about blockchain knowledge to enhance your understanding of the cryptocurrency space. Additionally, consider participating in blockchain-related activities that do not require financial investment, such as community exchanges or airdrop activities, to accumulate experience and understand market dynamics.
2. Cautious Exploration (100U Survival Rule)
Strategy: Small investments alongside a stable foundation
Advice: Allocate a portion of funds, such as 30%-50%, to invest in projects with certain potential but relatively low risk. Pay attention to emerging cryptocurrencies but conduct thorough research and analysis. At the same time, do not invest all your funds; retain a portion as a stable foundation. For example, continue with a stable job to ensure a continuous income source to mitigate potential investment risks. Moreover, use your spare time to deepen your understanding of blockchain technology, market trends, etc., to improve your investment judgment.
3. Trend Following (1000U Survival Rule)
Strategy: Stay updated on trends and manage risks
Advice: Closely monitor hot cryptocurrencies in the market, but avoid blindly following the crowd. Invest about 40%-60% of funds in cryptocurrencies with certain popularity and potential. At the same time, strictly control risks by setting reasonable stop-loss and take-profit points. When participating in contract trading, operate cautiously and understand the rules and risks of the contracts. At this stage, you need to enhance your ability to withstand market fluctuations, remain calm and rational, and not be swayed by emotions. Continue to monitor industry dynamics and the latest news to adjust investment strategies timely.
4. Potential Layout (10,000U Survival Rule)
Strategy: Forward-looking layout with a long-term perspective
Advice: Select potential cryptocurrencies within promising sectors such as AI, Layer 2, and Meme for layout. Allocate approximately 60%-70% of funds and choose multiple promising projects for diversified investment. Hold these cryptocurrencies for the long term, being patient as their value gradually releases. Maintain keen insight into the market, focusing on technological developments and industry trends, and stay informed about the progress and dynamics of the invested cryptocurrencies. Continuously learn and research to enhance your analytical abilities regarding different sectors and projects.
5. Diversified Investment (100,000U Survival Rule)
Strategy: Diversified allocation and risk balance
Advice: During market corrections, arrange funds reasonably to diversify investments in potential projects across multiple areas such as AI, Layer 2, Meme, platform tokens, and BTC ecology. Funds can be allocated according to the risks and potentials of different fields and projects, such as 40% in relatively stable projects, 30% in growth projects, 20% for exploring emerging fields, and 10% as cash reserves to respond to unexpected situations. Focus on asset safety and steady growth, reducing the risk of a single project or field through diversified allocation. Regularly assess the investment portfolio and make appropriate adjustments based on market changes and project developments.
6. Staking is King (1,000,000U Survival Rule)
Strategy: Utilize staking to increase passive income
Advice: Fully leverage your financial advantage by selecting reliable star projects for staking, such as Renzo, Puffer, Swell, etc. However, when choosing staking projects, conduct in-depth research and evaluation, including the project's reputation, technical strength, market prospects, etc. Allocate staking funds reasonably to avoid over-concentration. Meanwhile, closely monitor the dynamics and changes in the staking market as well as the development of the staked projects. In addition to staking, consider allocating a portion of funds to other stable investment methods to further achieve asset appreciation and preservation.
7. Strategic Lying Flat (10,000,000U Survival Rule)
Strategy: Grasp the overall trend and manage steadily
Advice: At this stage, wealth freedom has been achieved, and there is no need for frequent trading operations. It is more about macro grasping the overall market trends and directions. During major market crashes or surges, conduct bottom-fishing or selling operations at the right moments. Continue to utilize staking and other means to acquire stable passive income. At the same time, participate in governance of some popular projects to contribute to the industry’s development, which also helps maintain sensitivity to market changes. Moreover, plan personal and family wealth reasonably to ensure asset safety and sustainable growth. Consider allocating a portion of assets to other relatively stable fields to achieve diversified wealth management. While enjoying life, do not forget to manage and plan wealth steadily.
In the trading market, many novice traders often get lost in the fluctuating market, trying to seize every small opportunity while neglecting the core elements that truly determine success or failure - 'execution of trading rules' and 'control of mindset'. In fact, the essence of the market is a game of probabilities, and whether traders can survive in the long term often depends on their ability to adjust their mindset within the framework of the rules and manage risks well.
In this uncertain market, predicting market trends accurately is almost an impossible task. Many traders fall into the trap of over-analysis and over-prediction, trying to find a perfect answer in complex market trends. However, the essence of the market is volatility and cannot be fully controlled, so true success comes from how we respond to these fluctuations, rather than trying to completely foresee their direction.
True traders only care about two things: 1. What to do if the trend proves me right after I buy; 2. What to do if the trend proves me wrong after I buy. These two matters encompass the entirety of trading. We cannot control market trends, but we can control our responses to the market and our execution of trades. Trading is not a guessing game, but a probability problem. Rules and discipline are the only weapons traders have to continuously win in the market.
Consistent Trading Rules:
The market never has a clear direction to reference; any market situation is ambiguous. Even if we make a so-called 'accurate' prediction, the outcome may differ significantly from expectations. Therefore, the key to trading is not to seek the 'accurate' entry point, but to have 'consistent trading rules'. Every successful trader has their own set of rules and strategies, but regardless of how the rules change, the most important point is: 'Always execute these rules consistently.' Do not adjust your strategy arbitrarily due to market changes. Rules are a long-term effective framework; only by following this framework can we ensure fund growth most of the time. In my trading, almost every operation strictly follows the rules I set in advance. Post-trade analysis, market trends, and judging the next operation based on the rules, while during trading, I focus on execution and do not let market fluctuations distract me. Although this approach cannot guarantee that every trade is profitable, I know that as long as I execute according to the rules, in the long run, I will be on the favorable side of probability.
Do not overly pursue the perfect entry point:
Many novice traders often fall into a misconception: they always hope to precisely buy at the market's lowest point and sell at the highest point. However, market volatility inherently carries uncertainty, and even the most advanced technical analysis tools cannot accurately predict every price fluctuation. In fact, focusing too much on entry points often leads traders to miss better opportunities. Overly pursuing the perfect entry point often causes you to miss the best timing to enter. A slight fluctuation in price in an area does not affect the overall trading outcome. What matters is whether you can find suitable buying opportunities under the market's overall trend, which is the key to determining trading success or failure.
The relationship between losses and profits:
In trading, another challenge we face is losses. In fact, many traders fear not losses in the early stages, but rather stop-losses. They would rather cling to fantasies than cut losses. In reality, stop-losses are not disasters but part of risk control. True traders view stop-losses as tools for protecting capital rather than fear of failure. In the market, no one can achieve profitability on every trade; losses are inevitable. The key is how to control losses within acceptable limits when losing, and how to maximize profits through 'riding the trend' when winning. This way, the overall returns of traders will gradually accumulate. 'Profit is not based on predicting win rates, but on how to handle losses and profits.' This statement encapsulates the essence of trading. We must accept losses and implement corresponding risk management. When profitable, we need to maximize profits, making trading returns as high as possible.
Human nature and the essence of the market:
Trading is challenging partly because it is closely related to 'human nature'. Human weaknesses, such as greed, fear, and the desire for control, are often the fundamental reasons for trading failures. When faced with market volatility, many traders are often swayed by emotions, making irrational decisions. You may stop-loss too early due to fear of losses or hold positions too long out of greed, ultimately leading to losses. In the market, a trader's biggest enemy is not market volatility but their own human weaknesses. A successful trader often maintains composure in this tempting market through constant self-adjustment and psychological training. 'The essence of the market is randomness'; it does not follow fixed laws. Traders cannot succeed once but can fail repeatedly. A huge victory may lead you astray, excessively amplifying risks, ultimately resulting in catastrophic failure. This market does not allow you to be driven by greed; you must stay alert and strictly adhere to the rules.
The vast power disparity between the market and traders:
In the market, there exists a huge power gap between traders and the market: the capital of the market is infinite, while traders' funds are limited. It is akin to battling an unbeatable giant, where traders can only achieve some advantages on a local, temporary level. The market's time is infinite, while traders' time and energy are limited. Trading is a long-term battle, and each trader experiences a decline over time. Therefore, traders must understand that the market is always a formidable opponent, and what we can do is remain calm in this game, manage risks well, and be long-term players.
Practical Rules for Trading Cryptocurrencies:
Trend is King: Trade in accordance with market trends, seeking buying opportunities in upward trends and selling opportunities in downward trends.
Strict Stop-loss: Set stop-loss levels to control the maximum loss per trade, avoiding deep entrapment.
Capital Management: Allocate funds reasonably, avoid full-margin operations, and retain enough capital to cope with market fluctuations.
Not Greedy or Fearful: Do not be tempted by short-term profits, and do not panic due to market fluctuations. Maintain a calm trading mindset.
Avoid Chasing Highs and Selling Lows: Refrain from buying at market highs when sentiment is high or selling at low prices during market panic.
Learn Technical Analysis: Master basic technical analysis tools, such as candlestick charts, moving averages, MACD, etc., to support trading decisions.
Stay Informed: Keep up with market dynamics, policy changes, project progress, etc., as these factors may affect cryptocurrency prices.
Long-term Investment: Choose promising projects for long-term holding rather than frequent trading to achieve more stable returns.
Avoid Leverage Trading: While leverage trading may amplify profits, it also magnifies risks, and beginners should use it cautiously.
Maintain Independent Thinking: Do not blindly follow the crowd; have your own trading plan and strategy, and stick to your trading principles.
Conclusion: Trading is a process of self-cultivation
Trading is not a short-term victory but a process of self-cultivation. It requires us to constantly adjust our mindset, optimize strategies, overcome human weaknesses, and follow consistent rules. Every successful trader did not achieve success right from the start, but rather through countless failures and self-reflection gradually formed a mature trading system. In the market, we cannot control the external environment, but we can control ourselves. Once we master this, the ultimate victory will belong to those who stick to the rules and are not deceived by market fluctuations.
These days, I am preparing for a layout, and a divine order is about to open!!!
Comment 777 to get on board!!!
Impermanence brings impermanence!!!
