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The cryptocurrency market is constantly changing, and it is crucial for new investors to master some key investment strategies. Below are some valuable insights summarized by experienced investors, hoping to provide reference for friends who are just entering this field.
First of all, do not become overly attached to popular coins and small encryption currencies. When profits reach a certain level, it is wise to convert them at the right time. Trying to hold onto the same coin from beginning to end often leads to zero returns, as no encryption currency can maintain an upward trend forever.
Secondly, observing market trends is very important. When the coin price consolidates at a high level and then makes a new high, be cautious of potential induced rises and consider reducing positions or exiting. Conversely, if the coin price consolidates at a low level and then makes a new low but quickly rebounds, this may be the last market washout, and investors should maintain confidence.
The market environment has a significant impact on the price trends of cryptocurrencies. In an unfavorable market environment, cryptocurrencies that consolidate sideways or experience slight increases may have larger gains. Conversely, in a favorable market environment, cryptocurrencies that consolidate sideways or experience slight declines may face larger losses.
After determining the bottom price, a "buy two, sell one" rising pattern usually appears. In this case, investors should not doubt, as there may be a larger increase in the following period. Especially during a trend upward, there often alternates between price surges and consolidation, so it is not advisable to exit easily at this time.
Excellent investors will first focus on the overall sector trends, and only then on individual cryptocurrencies. Investors who rely solely on technical indicators are often beginners, while those who do not look at any analysis at all are more like gamblers.
Technical indicators are calculated based on price and trading volume, so true technical analysis requires taking both factors into account. Price increases require substantial capital to drive them.
In an upward trend, paying attention to support levels can improve the success rate of operations, and one can look for opportunities to buy at lower prices after a pullback. In a downward trend, focusing on resistance levels can help determine the timing for shorting or exiting.
These strategies and observational methods require investors to continuously verify and improve them in practice. Remember, the cryptocurrency market is filled with both risks and opportunities; rational investment and risk control are always the primary principles.