The 10 golden rules for surviving in cryptocurrency trading

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In the world of cryptocurrencies, the harshest rule is as follows: exchange platforms offer you 100x leverage, but charge you 100x in learning fees. Here are 10 essential rules drawn from experience for small investors who wish to survive and thrive:

  1. Do not buy too early during a decline - Wait for the panic to reach its peak after 8 consecutive days of decline before intervening. Technical analysis shows that trend reversals often occur after a prolonged series of declines.

  2. Avoid pursuing consecutive increases - After 2 days of increase, reduce your positions by 30%. Historical data indicates an increased probability of correction after several days of increase.

  3. Do not give in to FOMO after a strong rise - There is a 70% chance that the market will be bearish the day after a 7% increase. This statistic is based on the analysis of the volatility of major cryptocurrencies.

  4. Beware of highly publicized cryptocurrencies - Wait 2 weeks before investing. This period allows for assessing the project's solidity beyond the initial hype.

  5. Do not fight against volatility - Respect the market's rhythm. The ATR ( Average True Range ) indicator can help measure volatility and adjust strategies accordingly.

  6. Do not go against the trend - If the 30-day moving average is bearish, avoid holding positions. This technical indicator provides a clear view of the medium-term trend.

  7. Do not hold losing positions - Cut your losses quickly. Set strict stop-losses and stick to them to preserve your capital.

  8. Be cautious after 5 consecutive days of increase - The odds favor a reversal. The RSI (Relative Strength Index) indicator can help identify overbought conditions.

  9. Be attentive to volume-price divergences - Volume often reveals the truth about the strength of a movement. A price increase without significant volume may indicate weakness.

  10. Avoid over-leverage and all-in - Limit the maximum loss to 10% and leverage to a maximum of 2x. This risk management approach is crucial for long-term survival.

These rules, applied with discipline, can significantly improve trading performance. The market is constantly evolving, but discipline remains a key success factor.

Warning: This content is provided for informational purposes only and does not constitute investment advice. Trading cryptocurrencies carries significant risks.

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