Crypto newbie Day 7: A coin suddenly spikes—should you still chase it?
A few days ago, I was researching:
What Binance Alpha is,
the difference between exchanges and wallets,
what a “shitcoin” is,
and what a contract address is.
In the past few days, I also discovered a question that’s especially easy to get people hooked on:
When a coin suddenly surges, can you still chase it?
In the past, when I saw it jump 20%, 50%, or even double, my first reaction was:
“Damn—should I buy it right now?” 😂
Now I’m forcing myself not to buy immediately.
Right now, I ask myself five questions first:
① Why is it rising?
Is BTC driving it?
Did the project suddenly release some news?
Or did a large amount of money suddenly come in?
If I don’t even know the reason for the increase, I usually won’t rush to chase.
② How long has it been pumping?
It’s totally different at the very beginning of a move versus several hours of continuous暴涨.
The longer it has already been rising in a row, the more you shouldn’t look only at the percentage gain.
③ Is the trading volume keeping up?
If the price rises but the trading volume doesn’t clearly expand,
I become more cautious.
If both the price and the volume expand at the same time, it at least suggests there are more market participants.
④ Who is buying right now?
If most people only jump in after they see the sudden surge,
then I’d be even more careful.
Because I might not be among the first buyers,
but rather the person taking the last step of the relay.
⑤ If I buy it wrong, where do I admit my mistake?
This is actually the most important thing I learned recently.
Before, I used to think:
“Can this coin go up?”
Now I start thinking:
“If it doesn’t go up, how much can I lose at most?”
Those two ways of thinking are completely different.
So when I see a coin suddenly surge,
my first reaction has already shifted from:
“Can I still chase it?”
to:
“Research first, then decide.”
After all:
Making money doesn’t necessarily come from guessing correctly every time—
more important is not getting financially crippled when you guess wrong.
A few days ago, I was researching:
What Binance Alpha is,
the difference between exchanges and wallets,
what a “shitcoin” is,
and what a contract address is.
In the past few days, I also discovered a question that’s especially easy to get people hooked on:
When a coin suddenly surges, can you still chase it?
In the past, when I saw it jump 20%, 50%, or even double, my first reaction was:
“Damn—should I buy it right now?” 😂
Now I’m forcing myself not to buy immediately.
Right now, I ask myself five questions first:
① Why is it rising?
Is BTC driving it?
Did the project suddenly release some news?
Or did a large amount of money suddenly come in?
If I don’t even know the reason for the increase, I usually won’t rush to chase.
② How long has it been pumping?
It’s totally different at the very beginning of a move versus several hours of continuous暴涨.
The longer it has already been rising in a row, the more you shouldn’t look only at the percentage gain.
③ Is the trading volume keeping up?
If the price rises but the trading volume doesn’t clearly expand,
I become more cautious.
If both the price and the volume expand at the same time, it at least suggests there are more market participants.
④ Who is buying right now?
If most people only jump in after they see the sudden surge,
then I’d be even more careful.
Because I might not be among the first buyers,
but rather the person taking the last step of the relay.
⑤ If I buy it wrong, where do I admit my mistake?
This is actually the most important thing I learned recently.
Before, I used to think:
“Can this coin go up?”
Now I start thinking:
“If it doesn’t go up, how much can I lose at most?”
Those two ways of thinking are completely different.
So when I see a coin suddenly surge,
my first reaction has already shifted from:
“Can I still chase it?”
to:
“Research first, then decide.”
After all:
Making money doesn’t necessarily come from guessing correctly every time—
more important is not getting financially crippled when you guess wrong.