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In the crypto world, if you want to achieve stable profits, you don't need any sophisticated operations. Many people are actually ruined by complex analyses. The real logic of making money often involves the simplest methods—yet it is precisely these methods that make institutions take them seriously.
Let's start with the three most common pitfalls.
**First Pitfall: chasing highs and selling lows.** Ninety percent of losses are caused by this. When the price skyrockets, people get greedy and follow the trend, only to get trapped at the top with no way out. Conversely, skilled traders quietly position themselves during market downturns and when no one is paying attention. The difference in mindset determines the final profit or loss.
**Second Pitfall: going all-in on a single coin.** This is gambler's thinking. Putting all your assets into one coin is dangerously risky. The smart approach is to always keep 30% in cash, so you have the capital to buy the dip during a major decline. This way, you won't be wiped out by a black swan event.
**Third Pitfall: full position all-in.** Opportunities in the crypto space are abundant, but going all-in is self-imposed restraint. When your position is fully occupied, you can't jump on new, better opportunities. Proper position management is the real skill to survive in the crypto world.
Now, let's look at six practical short-term tactics.
Never guess blindly during sideways trading. Whether it's a high-level consolidation or a bottoming process, traps are hidden everywhere. Until the trend is confirmed to change, the best strategy is to stay put.
Sideways markets are actually deadly traps—about 80% of liquidations happen in such conditions. Impatient traders are most likely to fall into this trap.
Be willing to buy during bearish candles and sell during bullish candles; contrarian thinking is key. Most people want to chase the rally, but the market often goes against the majority.
There is a pattern in sharp declines: the more violent the drop, the stronger the rebound. Slow declines tend to have weak rebounds, but waterfall-style sell-offs often trigger violent rebounds.
Use the pyramid method for building positions. Start from the bottom area, adding 10% to your position each time the price drops by 10%. This helps to continuously lower your average cost.
When a trend reversal occurs, you must liquidate your positions. After a sharp rise followed by sideways movement, withdraw your principal. After a sharp decline and sideways consolidation, cut your losses decisively. As long as the green mountains remain, you can continue to make money.
The path to profit in the crypto space is fundamentally a contest of mindset and discipline.