Recently, I've been thinking about the topic of adding to positions, and I’ve found that many people still have misconceptions about it. Actually, adding to positions, simply put, is a kind of investment tool aimed at helping you lower your holding costs, but the premise is that you must have the ability to judge the market direction; otherwise, blindly adding to positions can instead increase your losses.

My observation is that not everyone is suitable for this logic of adding to positions. First, you need to have an accurate judgment of the market trend over the next few days. Second, you need sufficient backup funds—if you've already used 80% of your capital, don’t think about adding more. Capital allocation is crucial; only when the ratio of backup funds to current positions reaches at least 1:1 does there space to operate in adding to positions.

Let me talk about my own approach. I usually use a pyramiding method to add positions. Taking a long position as an example, I buy a small amount at a low point, such as 1 coin, then when the market rises to a certain level, I buy another coin, and as it continues to rise, I buy 2 coins, and so on. The advantage of this method is that the amount bought at low levels is always more than at high levels, naturally lowering your average cost below the market price. When I judge that the market is about to reverse, I quickly close the position either all at once or in two steps—note that the key here is to exit quickly.

However, there are several pitfalls in adding to positions that must be avoided. First, before using this method, you must be sufficiently familiar with the asset you are operating on, having experienced its full process of rising and falling or falling and rising, truly understanding both yourself and the market. Second, it can only be used in a market supported by fundamentals with a clear trend; if used during choppy or reversal periods, it often results in more losses than gains. Third, you must strictly follow the pyramiding principle to ensure cost advantages. Fourth, and most importantly—adding to positions is just a skill; the goal is to make money. Never add to positions just for the sake of adding.

I always tell people that in investing, learning should come first, and making money second. You need to accumulate knowledge over the long term and build your own judgment system, so you won’t always rely on analysts’ opinions. Once you understand technical analysis, you can calmly handle counter-trend fluctuations and secure the profits you should earn. Choice is greater than effort; if your trend judgment is accurate, you can find opportunities whether in a bull or bear market. Mainstream coins like BTC require focused research—master the rhythm, and steady profits are the way to go.