Author: Game
Compiled by: TechFlow
The fear that “this is the last cycle” + the uncertainty about how long the good times will last + the social pressure from others to perform better . These three make a deadly combination that destroys many people’s decision-making ability.
Possible consequences:
Distraction: Blindly chasing every hot trend while ignoring the need to focus on key trades.
Pessimism and indecision: Losing confidence due to uncertainty leads to the inability to hold any assets for the long term, or even not participating in the market at all.
Lack of faith: Lack of in-depth research on the project and inability to build sufficient confidence to cope with market fluctuations.
Lack of profit strategy: Due to the fear that the market trend will end, people rush to liquidate their positions when Bitcoin slightly corrects, missing out on greater profit potential.
Suggestions:
Focus areas:
Focus on specific areas or hot narratives within one or two chains.
Make a clear choice: on-chain trading or secondary trading, and focus on one direction.
If you think you can get involved in all areas at the same time, you are just fooling yourself. Focus your resources and energy on the areas that best meet current market conditions and can bring the highest returns. Combine your capital scale, advantages and market environment to find the direction and strategy that best suits you.
Clarify your modus operandi:
Understand whether you are investing, trading or speculating. There are essential differences between the three and do not confuse them.
A simple judgment framework can help you distinguish these approaches and develop corresponding strategies accordingly.
Stick to your plan:
Develop a clear action plan that includes the following elements:
Market Cap Range: Determine at which market cap range you will enter the market.
Profit plan: Make a rule to take profits in batches instead of completely clearing out all your positions at once out of fear.
Target Estimates: Set a target price that an asset may reach, as well as a time frame for achieving the target.
Stop loss conditions: Know when to stop loss partially or completely, which can be based on changes in fundamentals or technicals, or adjust strategies due to changes in the macroeconomic environment (such as important data to be released). For example, in the case of uncertainty in the macro environment, you can take profits appropriately and wait for a lower price to re-enter the market.
Know Yourself:
Find out your weaknesses: Is it a lack of experience? Is it a lack of technical ability? Is it an overly optimistic or overly pessimistic psychological bias? Is it a problem of improper money management or lack of time?
If you find that you have more weaknesses in these areas than others, then decisively give up the competition in this field. Choose the direction in which you have advantages and focus on the areas in which you are best.
Continuous Improvement
After each transaction, you should reflect carefully - which operations were successful, which were unsuccessful, and why? Was the problem in the process or decision, or was the decision itself reasonable at the time, but the result was not satisfactory?
Your goal is to continuously reduce errors in operations, gradually improve your winning rate through accumulation of experience, and appropriately increase your position when your hit rate is higher.
If you ignore this process, you are likely to fall into a long-term repetitive entanglement, and it will be difficult to make real progress either psychologically or in terms of profit and loss performance.
Don’t go it alone
In the market, reliable partners are essential. They can not only hold you accountable for your actions, but also help you make up for your shortcomings.
Truly high-quality trading opportunities often come from mutual support within the team—you make up for their shortcomings and they help you improve yourself.
Quality over quantity: The more partners you have, the better. You need traders who have a high hit rate and are trustworthy, who are at the same level as you or even better than you in the areas you focus on.
Broaden your horizons: Build a small circle of people who are outside your primary field and can provide you with important information about macro trends, market cycles, and other areas that are beyond your immediate focus. These insights will eventually feed back into your overall market understanding and help you formulate better strategies.
