Just a gambler, it's crucial to understand a few key principles. First, if you're opening leveraged positions at 5x-10x with all your capital, you're essentially gambling. The crypto market is highly volatile, with swings of 10%-20% being quite common, making such positions prone to liquidation. Even with stop-losses in place, a small market movement could wipe out most of your capital.
The key word for successful trading is "patience." If you're not patient, you're unlikely to succeed as a trader. Let's explore why.
First, avoid opening large positions (even 1x) with your entire principal, as it's no better than guessing the market's direction. Instead, you should only allocate 5% of your principal to any position. If it turns profitable, you can take profits at any time.
In the worst-case scenario, if the market moves against your position, patience is key. Since only 5% of your principal is affected, a 10% reversal means it's time to add more capital to your position. This can place you in a more advantageous spot when the market returns to its average price, which it typically does.
Once the market moves in your favor, wait for a bit longer, then take your profit and close the position. This method reduces risk and increases your chances of success over time.
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