My 7 years of trading experience has given me a different understanding of the market. My assets grew from an initial 35,000 to over 60 million, with a stable monthly profit of around $200,000. This success is not due to aggressive operations but a proven trading system. This methodology has also been passed on to many traders, some of whom doubled their assets in just three months. Today, I want to systematically break down these core ideas.

**The First Principle of Position Management**

Divide your capital into 5 parts, and only use one-fifth of it each time you enter a trade. The benefits are obvious—setting a stop loss at 10 points means a single mistake only loses 2% of your total funds. Even if you make five mistakes, you only lose 10%. Conversely, if your judgment is correct and you set a take profit at over 10 points, the risk-reward ratio is sufficient to support long-term stable profits. This ratio forms the basis of risk control.

**The Logic of Following the Trend**

Want to further improve your win rate? The key is two words: follow the trend. During a decline, each rebound is often a trap to induce buying; during an uptrend, each dip may be a golden opportunity. Many people struggle with whether to buy at the bottom for quick profits or to accumulate at low levels for more stability—the answer is that the latter has a higher safety factor.

**Key Criteria for Coin Selection**

There is an important discipline: stay away from coins that have experienced rapid surges in a short period, whether they are mainstream currencies or small tokens. Historical data shows that coins capable of multiple major upward waves are quite rare. After a short-term surge, continuing to rise becomes much more difficult because, after stagnating at high levels, the upward momentum is insufficient, naturally leading to a downward phase. Many understand this but still want to gamble—this is often the beginning of losses.

**Practical Application of Technical Indicators**

MACD is quite useful for judging momentum. When the DIF and DEA lines form a golden cross below the zero line and are about to break above zero, it’s a relatively stable entry signal. Conversely, when MACD forms a death cross above zero and moves downward, it’s time to consider reducing positions.

**Warning About Averaging Down**

I don’t know who first coined the term "averaging down," but it has caused many retail investors to blow up their accounts. The cycle of losing more while averaging down and losing even more is one of the most dangerous traps in trading, pushing you toward a dead end. The correct approach is: never average down when in a loss; only consider adding to your position when in profit. This is the bottom line for protecting your capital.

**Interaction Between Volume and Price**

Volume is the soul of the market. A volume breakout at a low consolidation zone is worth paying close attention to, but at high levels, if volume stagnates and prices stop rising, you must decisively reduce your position or exit. Many people tend to overlook this detail.

**Multi-Timeframe Trend Recognition**

Only trade coins that are in an uptrend, as this yields the highest win rate and avoids wasting effort. Different moving averages on various timeframes can help judge trend levels: a 3-day moving average turning upward is a short-term signal; a 30-day moving average turning upward indicates a medium-term opportunity; an 84-day moving average turning upward marks the start of a major upward wave; and a 120-day moving average turning upward signifies the establishment of a long-term upward trend.

**Post-Trade Review and Reflection**

Consistently reviewing each trade is crucial. Check whether your position logic still holds, whether the current weekly chart aligns with your initial judgment, and whether the trend has changed. Then, adjust your trading strategy accordingly. This step determines whether you can react quickly to market changes.

Building a trading system is not an overnight process; it requires market validation and continuous optimization. I hope these ideas can inspire you.