Li Hui's twelve-character trading mantra: Follow the trend, wait for opportunities, light positions, long-term holding, stop loss, take profit.
Li Hui emphasizes that especially in cryptocurrency trading, one must remain calm. Unlike stocks, trading can occur year-round, and one should never be blindly aggressive! Opportunities arise every day; do not let a single loss cloud your judgment! Continuously optimize your trading system and learn macro or micro strategies based on the fundamental indicators of the same asset!
First, the cost price is the final take profit price, known as the take profit rule. Do not let profitable trades end in losses! Preserving your capital is the top priority. Only by surviving can you have the chance to reap rewards!
Following the trend, waiting for opportunities, light positions, long-term holding, stop loss, take profit. This encompasses the four major rules of trading:
The Simple and Gentle Rule. "Simple" refers to the simplest trend, which is also the strongest trend. "Easy" means to trade in easy-to-handle markets. "Gentle" means to trade systematically according to your trading habits, being careful not to go against the trend. (Only in cases of extreme rises or falls can one trade lightly against the market.) For example, if there are consecutive upward/downward turns or corrections, one should firmly trade in one direction. In a fluctuating range, do not break the range; instead, sell high during rapid rises and buy low during drops to make trades.
The Waiting Rule—also known as the Certainty Rule (which can filter out poor trades). Remember: the quality of trades is inversely proportional to their quantity. Rash operations without thought lead to losses not only in capital but also in confidence, causing fatigue and loss of fighting spirit. Be well-versed in bullish and bearish patterns, and grasp the critical points of trading.
The Position Control Rule—Stable Rule (Light Position Rule). No matter how high the odds, always trade lightly (not fully invested). Remember: heavy positions must be short-term, while long-term must be light positions. Only after experiencing the pain of heavy positions can one understand the importance of not over-leveraging.
The Growth Rule—(Stop Loss, Take Profit, Hold Profits). First, set a stop loss level to endure volatile losses, then raise the take profit level after making a profit, without breaking the trading system, holding profits until the end of the market trend. There are three types of stop losses: first, a reversal of the trading system; second, based on candlestick patterns; third, using the opening price of a significant candlestick as the stop loss point.
You must form your own trading decision system and have your own perspective on the market, with a certain level of insight and preferably some foresight. When trading, trust your inner thoughts and try to eliminate external distractions. In short, respect the market and believe in yourself.
Trading is about gains and losses, much like warfare; winning and losing are common occurrences. You may earn this time and lose the next, but as long as the final tally shows more earnings than losses, and you earn more when you win and lose less when you lose, you can achieve victory. Never let a single large loss wipe out your capital; recovering from that is not easy. If you want to profit in the cryptocurrency space, you must undergo trials. How to endure these trials? You must learn more and practice more; this is your self-discipline. If you only listen to others without developing your own subjective awareness, you will eventually fall at the hands of others. Therefore, ultimately, if you rely solely on others without learning, Li Hui can only offer good advice.
Li Hui believes that investing is actually a long process of self-management! The difficulty lies in understanding, stopping at emotions, breaking at actions, being lazy in dependence, quick in independence, chaotic in pulling others, profitable in following the right path, suffering in solo efforts, clever in leveraging, losing in selfishness, wrong in blaming, winning in reflection, lacking in change, tired in blindness, valuable in effort, losing in arrogance, failing in insufficient learning, and defeated in giving up. Success comes from persistence, remaining humble and steady, and moving forward diligently! Remember the ancient market principle: quickly terminate losing positions and hold profitable positions as long as possible. Another important rule is to avoid letting losses occur in positions that have already made profits. When faced with sudden market reversals, it is better to close positions without profit than to let previously profitable positions turn into losses.
When facing losses, remember not to rush into opening new opposite positions in hopes of turning things around, as this often worsens the situation. Only if you believe your original predictions and decisions are completely wrong should you quickly close the losing position and open a new opposite position. Do not play guessing games with market changes; missing trading opportunities is always better than incurring losses.
Mount Tai does not stand on preferences, thus it can reach great heights; rivers and seas do not choose small tributaries, thus they can become rich. In the cryptocurrency space, one must be well-educated and then self-reflect to become a master.
I, Li Hui, interpret world economic news and analyze global cryptocurrency trends. During my studies in the U.S., I conducted in-depth research on BTC, ETH, LTC, DOT, EOS, BNB, SOL, and other cryptocurrencies. For those who are unsure how to operate, feel free to comment! This article is exclusively published by (WeChat public account: Zhang Li Hui) for reference only; risks are borne by the reader. May we remain humble and brave in the complex cryptocurrency space, unafraid of challenges and willing to explore. Just as "the road is long and arduous, I will seek diligently," I hope we keep pace with the times, absorb wisdom, travel thousands of miles, weather storms, and gain insights into life.
May you, under Li Hui's guidance, leverage your strengths and avoid weaknesses, create value, and remember the market's baptism, staying true to your original intentions. In the wave of digital currency, may we hold onto our beliefs, forge ahead, and together compose a glorious future, sharing the joy of success. Let us join hands in this investment journey filled with challenges and opportunities, creating brilliance together!
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