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In the ever-changing Crypto Assets market, understanding market trends has become a key skill for investors. The following six trading principles may provide you with a new perspective:
1. Interpretation of the rise and fall rhythm:
Rapid increases and slow declines usually indicate an accumulation phase. If you encounter a slow pullback after a sharp rise, there is no need to panic. However, when you see a sharp drop after a significant surge, this is often a dangerous signal, and it is recommended to stop loss in a timely manner.
2. Identification of Shipping Signals:
A rapid decline followed by a slow rise may indicate that funds are withdrawing. Stay vigilant during the slow rebound after a sharp drop, as this could be the last opportunity to escape. Do not cling to the mindset of 'there's nothing left to fall'; the market is always full of surprises.
3. The Importance of Trading Volume:
The trading volume remains active at high levels, which may indicate that the upward momentum is still present. Conversely, a shrinking trading volume at high levels often signals a downturn, and at this point, one should consider reducing positions.
4. Interpretation of Volume at the Bottom:
A single day's trading volume is not sufficient to confirm a bottom. Continuous trading volume over multiple days, especially the sustained volume that appears after fluctuations, is a more reliable signal for building positions.
5. Volume and Market Sentiment:
Trading volume is the barometer of market sentiment. A continuous shrinkage in volume indicates a weakening interest in the market, while a sudden surge in volume may signal the arrival of a new round of market trends.
6. Cultivating a Trading Mindset:
The ideal trading state is to be able to not be attached to a single viewpoint, to dare to liquidate and wait when necessary; not to be swayed by greed, avoiding chasing highs; while also not being dominated by fear, daring to buy at the right moment. This requires continuous learning and practice.
The core of trading strategy lies in formulating and strictly adhering to rules to overcome human weaknesses. Reasonable position management, focusing on high-probability market conditions, and mechanized profit-taking and stop-loss measures are all effective methods for controlling risk.
In this market where opportunities and risks coexist, staying calm and rational, continuously learning, and participating moderately are the keys to long-term victory. Every investor should develop a trading strategy that suits their own risk tolerance and investment goals.