First, there is no patience.
Bitcoin only cycles once every 4 years, and there are too many people who only entered the market 4 days ago and are complaining about why my currency hasn’t risen yet. Most people jump in because of the fact that cryptocurrency can bring high returns in a shorter period of time. After all, the pace is indeed fast, but it is not fast in a day or two. Taking the K-line chart as an example, stock market investors look at the monthly or even quarterly lines, while most currency circles look at the daily line. 4 hours, one hour is short enough. If you find yourself always staring at the 5-minute line or even the 1-minute line when watching the market, is it possible that you are too anxious? When we talk about bargain hunting in Bitcoin, we are not talking about catching the lows of a day or two, a few weeks, or even a few months. That is too difficult for most investors. But if you extend the time to 1 year, 2 years, 5 years, or even 10 years, there is a very good chance. Nowadays, 20,000 yuan to enter the market, 20,000 5 yuan to enter the market, or 10,000 5 yuan to enter the market are basically the same cheap concept. Just like TSMC's stock, no one cares whether you buy it at 50 or 60 yuan, because today, it is very early. Just like Buffett said, if you are only allowed to make 7 investment decisions in your life, you will become very rich because you will become very patient to win your investment. This will happen in a day for decades. Circle is an important mental method. You must know that patience is the trait that most people lack the most. You must know that it is much more difficult to grasp the short-term rise and fall than to judge the long-term trend.
Second, I like to chase the high and kill the low.
The most famous term in market psychology is formal fear of missing out. How many people thoughtlessly jumped into Dogecoin when it rose to $0.7, and how many people shouted for $100,000 when Bitcoin reached 69,000. Not to mention that the skyrocketing NFTs at that time created billionaires now. Everyone knows that currency prices will always reverse when market sentiment is overheated. Everyone usually talks about having a good attitude, following the trend, and being more formal. Whenever a currency surges several times in a few days, everyone's topic is It will turn into something like it has been profitable recently, and it should be possible to enter the market during this period. For retail investors like us, whether the good news we hear now will turn to the formal mentality of the community, or is it really based on experience and our own research? In this section, it is recommended for novice players to read more and listen more, enter the market in batches, and establish the investment concepts of dollar-cost averaging and grid-style buying low, selling high, and building positions. After all, stripping away all packaging, the only principle to make a profit in the financial market is to buy when assets are cheap and sell when they are expensive, nothing else.
Third, hold the wrong currency for a long time.
The most popular investment philosophy in cryptocurrency is buy and hold, which means long-term holding. However, this strategy, which is only applicable to a few mainstream currencies, is often copied by various small currencies. Of course we are optimistic about the development of blockchain technology in the long term, but to be honest, there are currently more than 20,000 cryptocurrencies on the market. How many of them do you think will continue to exist in 10 years? Probably less than 10%. Furthermore, those cryptocurrencies that are said to be among the top 100 currencies and can become mainstream blue chips, based on historical experience, are mostly bull markets. When the market is hot, they can become a temporary success. When the market cools down, even if they are called blue chips, they may not be able to maintain their popularity. Price community popularity, and even the value behind miners’ operations. Look at EOS, which is known as the killer of Ethereum in 2017, Bitcoin which is known as better, the so-called Bitcoin Cash BCH and BSV. At that time, the supporters of these projects were still quite active, but the advantages and disadvantages between them and Bitcoin and Ethereum now seem to be incomparable, and the current coins are not far behind. The game by track is now suffering heavy casualties. Even the strongest stepn and axie Infinity have to face a 90% decline in the bear market. Defi or even defi 2.0. Countless NFT projects will rise in the bull market and will fall in the bear market. fall. It’s not that these tracks have no future, but even for excellent coins on high-quality tracks, the currency prices in the bull market may be too flooded by speculation. Luna, which once ranked among the top ten in market value, can directly return to the market within a few days. zero. Therefore, the coins that can be hodl held for a long time, for newbies in the currency circle, are mainly Bitcoin BTC and Ethereum ETH.
Fourth, do not strictly stop losses.
The first lesson for a novice to learn trading is to establish stop loss habits and discipline. Stop loss means that when you buy a currency, of course you judge that it will rise, but if it falls, when does it fall, you have to admit your loss and exit, and strictly implement stop loss again and again. At first glance, You will still lose money every time, but in fact you are protecting your principal so that you can earn it back in the future. The opposite word of stop loss is concave order, which means that the market has clearly proven that you are in the wrong direction, but you are still following it. Many friends in the currency circle, some of whom are old players, still have such bad habits, such as buying and going long Bitcoin. Of course, they buy it only if they believe it will rise, and then tell themselves that if they are wrong, they will lose 10% at most and exit the market. . Suddenly I felt unconvinced. It was not for any reason. I clearly saw that I would not lose money, so it was 10%11% time to exit. We often hesitate at this time, you know? We think we can convince ourselves that maybe it will rise back up and we can just lose 20% of the stop loss. Sometimes you can make a comeback, but when you can't, 70% to 80% of your funds may be lost in one fell swoop. There is a very unfair rule on the balance of profit and loss. You can make 100% profit 10 times in a row, but you can lose 100% once, and all your previous profits will be in vain. As a result, will the market admit its mistake when cryptocurrencies fluctuate violently? Although it is heartbreaking, it is what the outstanding traders who survive do it every day.
Fifth, borrow money to invest.
If you are a retail investor, you should never borrow money to buy coins. Have you heard this? I myself have also heard of people successfully suppressing Dogecoin, NFT, etc. by borrowing money to buy coins. There are hundreds of Bitcoin stories in the wallet now, because it has any famous teacher exchange group? As long as someone encourages you to borrow money to buy coins, or even he is willing to lend you some money to invest, don't think he is a good person, ignore him, and don't take risks you can't bear. It is obvious that humans make profits and losses when investing in financial markets. Why has it developed into a reasonable and even meaningful social behavior over hundreds of years? Because as long as risks and losses are controllable, as time goes by and individuals and industries grow, investment behavior is usually a money-making behavior, and the first thing to get risks and losses out of control is to borrow money and raise funds. cast. Taoism says that blessings and misfortunes bring blessings. People who want to borrow money to invest will see: I have no principal, and I have no interest in making money. If you borrow money, you can make money, but the most important thing about the Internet is that if you lose money, you may be miserable for the rest of your life. Even Ray Dalio dare not say that a certain fund of his will definitely make money. No investment teacher can give you enough confidence to take the risk of borrowing money to buy coins.
Sixth, risk diversification was not done well.
In the currency circle, you will often hear people encouraging you to go all in stud. If you win, you will be a young model in the club, if you lose, you will work in the sea. In fact, you usually know that everyone is joking, but if you hear these boring words too much, sometimes you really want to make a critical strike once or twice with a heavy position. Hey, it is often just one or two irrational operations that cause people to lose money. Most of the assets. Mt Gox, once the world's largest exchange, was hacked, all user funds were frozen, and a lawsuit was filed. Terra Luna, which was once the top two public chain, fell to zero overnight, and some people even committed suicide because of it. Just like what everyone says is the safest cold wallet, there have also been leaks from users. So we say that when investing in cryptocurrency, diversifying risks is always the most important moment. First of all, when newbies enter the currency circle, it is not recommended to invest more than 20% of the total principal. It is best to place these funds mainly on mainstream exchanges, mainly investing in Bitcoin and Ethereum. Each of these most mainstream coins has Potential tracks such as Defi Metaverse can be purchased in small quantities, and it is recommended to put them on several more platforms. Just by doing this, you can effectively diversify systemic risks, track risks and platform risks.
Seventh, sell too early.
Do you know how easy it is to get rich with Bitcoin? As long as you bought 1,000 yuan of BTC in 2011 and never sold it, you would be rich today. This sounds easy, but in fact, those who have been coin holders from 2011 until now are definitely in the minority. We often overweight short-term skyrocketing coins that we shouldn’t, but for the major mainstream coins that are truly bullish and worthy of holding in the long term, we often sell short, that is, we sell them while they are still rising and miss out on subsequent gains. People call such people a paper hand, a term used in currency circles to refer to investors who sell their assets out of fear, panic, or lack of belief at the first sign of loss. The term is often used pejoratively to describe someone who doesn't have the courage or patience to stay invested when the market falls. It is said that such people have no faith. What’s interesting is that many people hear others say that they can’t do it without faith, and in a fit of anger they chase the price of other small coins and other NFTs, and then start the journey of losing money.
The eighth insight is capital disk or pyramid scheme.
Although people are full of misunderstandings about the currency circle, this field is full of fraudulent funds, and this fact has never changed. Most of the friends you met through dating software will tell you that they have met a great teacher who helped him make a lot of money in virtual currency. He will help you join his group, then download a certain platform to deposit money and follow him to buy. Or they have an unlisted currency. Sign up to invest now. Once it is listed next month, don't say it is the same as Bitcoin. Even 1% of my Bitcoin can make you rich. He also said that they have digital currency smart contracts, smart brick-moving contracts, and profitable AI that can allow you to get 10-50% returns every month. If you find friends, you can double your income. Basically, you can deposit money into something like this, but there is no way to withdraw the money. If you are talking about fraud or funding, you must know the general loan return rate of most currency circle institutions, which is at most 5-15% a year. If it exceeds this number, don't touch it. As the saying goes, if you don't know where your rate of return comes from, you may be the source of someone else's rate of return. This is called a capital market, and the money behind is used to make up for the money before. It is worth mentioning that more than 90% of people who tell you that you can borrow money to invest are also fund-responses and scams. 3 key points: Don’t easily believe in the investment opportunities recognized on dating software, don’t invest in projects for which you don’t know the profit principle, and don’t think you have a chance to buy a good coin that has not been listed on the market. There is a much higher chance that it will never be listed on the market.
