Regarding on-chain trading, there are several important principles:
Avoid using large amounts of capital.
The definition of large capital varies from person to person.
For example, if you have $100,000, use $10,000 to participate; if you have $1,000,000, invest $100,000 to $200,000; if you have $10,000,000, invest $1,000,000.
In short, only use funds you can afford to lose.
Because the risks of on-chain trading are relatively high, far higher than traditional exchanges.
Clarify your trading strategy.
The wizard shared three trading strategies on Twitter; others are often traps:
a) Hot coins
For example, the recent PINUT, LUCE, BAN, etc., these coins can quickly rise to tens of millions or even hundreds of millions in market value.
The key is to judge whether enough people recognize the narrative.
The best time to enter: if the market value is within $10 million, it can be considered; be cautious when it exceeds $30 million.
Hot coins generally experience an 80% decline; entering when the decline is 80% has a higher chance of success, but be careful of traps.
b) Blue chips and potential coins
For example, ACT, POPCAT, etc., these coins do not rise based on hype but through multiple setbacks and community consensus accumulation.
These coins also often drop by 80%, but have strong long-term vitality.
The best entry time is when the market value is in the millions to tens of millions of dollars; an 80% drop is a good opportunity to increase positions.
Observe the project's community atmosphere and consider the feasibility of the project.
c) Large market cap blue chips
Generally, only large market cap coins listed on major exchanges are worth paying attention to.
The logic is to judge the weight of funds and tracks.
For example, when Neiro reaches a market value of $300 million, I dare to take over; ACT still has significant development space.
But if it is not listed on major exchanges like Binance and has a market value of over $1 billion, participation is not recommended.
Conclusion
These principles and strategies stem from the wizard's years of experience and reflection.
Everyone's standards and judgments may differ, but the most important thing is to have your own trading logic and avoid blindly following others.
Deeply think about the logic behind each trade to better seize opportunities.
I hope these suggestions from the wizard can help you better understand the risks and opportunities of on-chain trading!
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