From Heavy Losses to Steady Profits: Three Principles to Avoid 90% of Traps in the Crypto Market

The cryptocurrency market is always harsh, where 90% of retail investors often lose money by chasing “quick money opportunities” and overestimating unclear signals. In reality, those who survive and earn sustainable profits are not the ones good at guessing tops or bottoms, but those who know how to preserve capital and stick to discipline. After years of observation, three simple but extremely effective principles can be drawn to help investors avoid most common mistakes:

1. Only Trade When Opportunities Are Clear, Don’t Chase Rumors Many investors often jump into “opportunities” from chat groups, circulating news, or unverified projects. An effective strategy is to focus on truly transparent signals: Main trends: for example, a leading coin breaking a significant weekly resistance level with rising liquidity, confirming the trend. Reasonable entry points: when the price returns to historical lows but shows at least three consecutive bullish candles, indicating buying momentum is forming. Instead of opening trades continuously every day, reduce your monitoring frequency and only trade when there’s a clear signal. This helps reduce stress, minimize mistakes, and improve performance.

2. The “Three-Phase” Strategy When Opening a Position The main reason many people lose money is going all-in: putting all capital into a single trade. A safer strategy is to split the capital into three phases: Test-the-water phase (10%): open a small position to test the trend. If it loses, the loss is limited and there’s still capital for the next steps. Trend-following phase (20%): when the price confirms the trend, increase the size to take advantage of a bigger move. Confirmation phase (30%): when there’s a definite signal, add the final portion to optimize profit. Along with that, always set a fixed stop-loss, for example, cut the trade if the maximum loss reaches 5%, never try to hold a losing position. This strategy helps control risk, avoid bankruptcy, but still capitalize on profit opportunities.

3. Always “Secure Your Profits”: Take Profit and Protect Capital Many investors tend to think “it’ll go higher” and let profits return to zero. The important principle is: Periodically take partial profits: for example, every time you reach 25% profit, transfer 40% to a cold wallet. Don’t touch the money you’ve already cashed out: ensure that even if the market fluctuates, the profits earned remain safe. This habit helps stabilize your mindset, avoid “FOMO” or “greed” that leads to lost profits, and gradually build sustainable wealth.

Conclusion The crypto market is not a place for luck or guessing tops and bottoms. The winners are those who are patient, disciplined, and know how to protect their capital. The three principles above—trading on clear signals, opening positions in three phases, and taking profits correctly—are simple but extremely effective ways to turn the “big loss – regret” experience into stable and sustainable profits.