After eight years of trading, I’ve grown my initial 50,000 principal to over 50 million. I’ve always stuck to one principle: slowly grind with a 50% position, and my monthly returns have basically stayed around 70%. I previously taught this method to my cousin, and he doubled his money in three months. Since I’m in a good mood today, I’ll organize the pitfalls I’ve encountered and the insights I’ve gained over the years.

**Don’t be sloppy with fund allocation.** I’m used to splitting my principal into 5 parts, and at most I’ll only use one part at a time. I set a hard stop-loss at 10%, so even if I’m wrong once, I only lose 2% of total funds. Even if I get it wrong 5 times in a row, that’s just a 10% drawdown. On the flip side, I set my take-profit at over 10%, so the risk-reward is clear, and the chances of getting trapped are actually pretty low.

**Go with the trend—easier said than done.** In a downtrend, every rebound is a bull trap; in an uptrend, every pullback is a buying opportunity. Which is safer—catching the bottom or buying on dips? The answer is obvious, but some people just love to risk it all.

**Don’t touch coins that have already skyrocketed.** Whether it’s a major or an altcoin, it’s very rare for a coin to have a second wave of surges after a short-term explosive rally. The logic is simple: when a coin goes sideways at a high level, it’s a sign it can’t move higher, and there’s a 90% chance it’ll pull back. Still, some people just want to gamble.

**MACD is really useful for timing entries and exits.** When DIF and DEA form a golden cross below the zero line and then break above it, that’s a pretty solid entry signal. Conversely, if MACD forms a death cross above the zero line and starts heading down, it’s time to consider reducing your position.

**Averaging down is a trap.** I don’t know who invented it, but retail traders have lost count of how many times they’ve been burned by this. The more you lose, the more you average down—the bigger the losses get. This is a cardinal sin in trading. Remember: never add to losing positions; only add when you’re in profit.

**Volume-price relationship is always the top priority.** Trading volume is the market’s emotional thermometer. If a coin breaks out with high volume at a low level, keep a close eye on it; if it stalls at a high level with high volume, exit decisively.

**Only trade coins in an uptrend.** An upward turn on the 3-day moving average is a short-term signal; the 30-day MA up is a mid-term trend; the 84-day MA up usually means a main bull run is starting; the 120-day MA up signals a long-term bull market. Don’t go against the trend—it saves time and worry.

**Stick with reviewing your trades.** After the market closes each day, check: has the logic for holding changed? Does the weekly K-line match your expectations? Are there signs of a trend reversal? Adjust your strategy in time—it’s a hundred times better than stubbornly holding on.

The market will always be there. The key is to find a rhythm that suits you and approach it with a systematic mindset, not just rush in on gut feeling.