In the cryptocurrency market, most retail investors suffer losses due to a lack of understanding of market rules and blind operations. This article shares 13 rules for survival in the market, aimed at helping investors avoid common pitfalls and improve their investment success rate.
First, we need to recognize the truth about bull and bear markets. In a bull market, it is crucial to hold onto mainstream cryptocurrencies. Some investors switched to altcoins when Ethereum rose from $2000 to $3000, only to miss the opportunity of Ethereum climbing to $4000, while the altcoins instead dropped by 30%. This tells us that frequently changing coins in a bull market often leads to missing the best opportunities.
On the contrary, blindly holding during a bear market is not a wise move either. During the bear market of 2018, some investors held onto EOS as it dropped from $100 to $5, believing it to be "value investing." However, when the bull market arrived and EOS rose to $15, they sold, missing out on the subsequent rise to $50. This illustrates that during a bear market, we need to carefully assess the value of the cryptocurrencies we hold, rather than indiscriminately holding them for the long term.
There is an important rule in the market: "When the volume reaches a historical high, the price reaches a historical high; when the volume is low, there is no price." When trading volume hits a historical peak, it often indicates that the price is about to peak. For example, when the price of Bitcoin reached $69,000 last year, the trading volume hit a historic high, which was an important signal to reduce positions.
Overall, successful cryptocurrency investment requires us to deeply understand market rules, maintain rational judgment, and adjust strategies in a timely manner. Whether in a bull market or bear market, there are unique operational logics. By learning and practicing these iron rules, investors can significantly enhance their survival ability in this high-risk, high-return market.
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In the cryptocurrency market, most retail investors suffer losses due to a lack of understanding of market rules and blind operations. This article shares 13 rules for survival in the market, aimed at helping investors avoid common pitfalls and improve their investment success rate.
First, we need to recognize the truth about bull and bear markets. In a bull market, it is crucial to hold onto mainstream cryptocurrencies. Some investors switched to altcoins when Ethereum rose from $2000 to $3000, only to miss the opportunity of Ethereum climbing to $4000, while the altcoins instead dropped by 30%. This tells us that frequently changing coins in a bull market often leads to missing the best opportunities.
On the contrary, blindly holding during a bear market is not a wise move either. During the bear market of 2018, some investors held onto EOS as it dropped from $100 to $5, believing it to be "value investing." However, when the bull market arrived and EOS rose to $15, they sold, missing out on the subsequent rise to $50. This illustrates that during a bear market, we need to carefully assess the value of the cryptocurrencies we hold, rather than indiscriminately holding them for the long term.
There is an important rule in the market: "When the volume reaches a historical high, the price reaches a historical high; when the volume is low, there is no price." When trading volume hits a historical peak, it often indicates that the price is about to peak. For example, when the price of Bitcoin reached $69,000 last year, the trading volume hit a historic high, which was an important signal to reduce positions.
Overall, successful cryptocurrency investment requires us to deeply understand market rules, maintain rational judgment, and adjust strategies in a timely manner. Whether in a bull market or bear market, there are unique operational logics. By learning and practicing these iron rules, investors can significantly enhance their survival ability in this high-risk, high-return market.