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Many traders stumble in the crypto market, and the root cause is not market prediction but the lack of a systematic trading framework. Today, I share a complete strategy framework covering core aspects such as position management, entry and exit signals, and risk control.
**Basic Logic of Position Management**
Divide your funds into 5 parts, investing only one-fifth each time. What are the benefits of this approach? Set a 10-point stop loss, so a single loss only affects 2% of your total capital. You need to lose 5 times to wipe out this amount. Conversely, if you are correct, set a take profit above 10 points. Operating according to this logic makes risk completely controllable.
**The Key to Increasing Win Rate: Trend Following**
In a downtrend, every rebound is a trap for trap hunting; in an uptrend, every dip could be a golden opportunity. Are you trying to bottom fish for quick profits, or waiting for a rebound at low levels? The latter often has a higher success rate. This is not simply about right or wrong but about probabilities.
**Selection Principles for Altcoin Choices**
Stay away from coins that surge rapidly in the short term, whether mainstream or altcoins. Very few coins can sustain multiple major upward waves. After a short-term surge, further increases become much more difficult. During the high-level stagnation phase, if the price cannot be pushed up, it will inevitably fall. The logic is simple, but most people still want to take a gamble.
**Application of Technical Indicators: MACD Entry and Exit Signals**
When DIF and DEA form a golden cross below the zero line and break above zero, it is a stable entry signal. When MACD forms a death cross above the zero line and moves downward, consider reducing your position. Combining this indicator with other tools can significantly improve accuracy.
**Averaging Down vs. Adding Positions: Two Completely Different Concepts**
Many retail investors keep adding to losing positions, which is the most fatal mistake. Always remember one principle: do not add to losing positions; only add when in profit. The former is self-punishment, while the latter is the correct approach to risk management.
**Practical Significance of Volume-Price Relationship**
Volume is the soul of the market. Pay close attention to volume breakthroughs at low levels, which usually indicate the start of a new upward cycle. Conversely, high volume at a plateau with stagnation is a warning sign, and you should exit decisively.
**Multi-Timeframe Moving Average System**
The 3-day moving average turning upward indicates short-term bullishness; the 30-day moving average represents mid-term; the 84-day moving average indicates the main upward wave; the 120-day moving average reflects long-term trend. Focus only on coins in an uptrend for the highest success rate, avoiding wasting time. Signals from multi-timeframe resonance are the most reliable.
**The Necessity of Continuous Review**
Every trading session should be reviewed. Check whether your holding logic still holds, whether the weekly technical trend aligns with your initial judgment, and whether the overall direction has changed. Adjust your trading strategy promptly; this is the key to long-term steady gains.
Markets are always there; finding your own strategic system is the key. Use systematic thinking to respond to the market, and you can stand firm amid volatility.