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After years of struggling in the Crypto Assets market, I have deeply realized the dangers of emotional trading. I used to be that trader who stared at the Candlestick Chart day and night, analyzing market trends at three in the morning. Whenever I saw Favourable Information, I would thoughtlessly go all-in; when faced with negative news, I would panic and Cut Loss to exit. This trading approach led me to lose my initial capital of 80,000 down to only 20,000 in just six months.
Until one day, I checked the statistics of the trading software and was surprised to find that 93% of my real-time trades had resulted in losses. This data made me realize that focusing too much on short-term market fluctuations was actually the main reason for the losses.
After careful consideration, I have formulated a set of 'Three Principles of Mechanical Trading' to make investment decisions with a programmatic mindset. This approach has not only freed me from the troubles of emotional trading but has also brought stable growth in returns.
The first principle is to use conditional orders instead of manual monitoring. I only spend half an hour analyzing the weekly Candlestick Chart on weekends, selecting the top 30 mainstream coins by market capitalization, and setting price alerts. When the coin price falls near the annual line and the Relative Strength Index (RSI) is below 30, the system will automatically buy 10% of the position; when the price rebounds to the resistance level, it automatically sells 50% of the holdings. This method not only saves a lot of time but also avoids human judgment errors.
The second principle is to control risk through position management. I use a 'pyramid averaging model': I initially allocate 10%, and each time the price drops by 15%, I add 20% to the position, with a maximum of three additions. At the same time, I also set strict stop-loss lines, and any single coin's loss reaching 25% will result in immediate liquidation. This model has played an important role during certain crypto assets plummets, effectively controlling losses.
The third principle is to leverage profit reinvestment to achieve the compound interest effect. Whenever profits reach 50%, I will transfer 30% of that to a cold wallet for safekeeping, while the remaining profit continues to be invested in the market. Through this method, I not only achieve stable asset appreciation but also ensure that a portion of the profits is truly secured.
Some may question that this strategy might miss out on explosive growth opportunities, but according to my statistics, strictly implementing this strategy for three years has achieved an annualized return of 287%, far surpassing that of investors who trade frequently.
Now, I only need to spend a little time each day checking my account status. The time saved is used to learn about blockchain technology, which has helped me seize early investment opportunities in some high-quality projects.
In this round-the-clock volatile Crypto Assets market, the most effective strategies are often those that do not require you to constantly monitor the market. When you learn to trade systematically rather than being swayed by emotions, you can truly grasp the essence of Crypto Assets investing.