Crypto,  Trading Lessons

You Won’t Become Profitable Until You Stop Following Others

We all have a phase in the beginning of our trading career where we don’t know how to find our own plays.

So, what do we do? 

We look for others, who we consider more experienced, so that we can follow their calls and trade the coins they say are good.

It’s a perfectly natural progression for a new trader. 

When you first start out, you don’t even know what it is that you don’t know yet.

There’s so much to learn that it can feel overwhelming pretty quickly.

This leads many to getting stuck on the treadmill of only being able to find trades when their favorite influencer tweets about something.

They never progress to the stage where they can parse information and find trades for themselves.  

Because of this, those traders never become consistently profitable. 

Forever they are at the mercy of the timeline in their attempts to make profits.

If you ever hope to make any appreciable amount of money, and more importantly, keep that money… you have to develop your own ability to find plays and trade them.

There are a handful of people every cycle who make absurd amounts of money, who have no idea what they’re doing.

They luck into buying DOGE, SHIB, WIF or whatever other token fate has chosen for that cycle, and they make a retarded amount of money… on paper. 

Usually, these people end up roundtripping 99% of those screenshots they became known for. 

These people don’t know how to trade. 

They don’t know how to find good trades repeatedly. 

They got lucky, and they know it. 

That’s what causes a lot of people to round trip profits when they’re up big.

They fear they won’t be able to find another play like this. 

If they don’t maximize this ONCE IN A LIFETIME play (it’s not) then they’ll never get another opportunity, because they don’t know how to repeat this success.

I have no problem peeling profits off of trades because I know I can always find another play.

Some plays are obviously better than others, and I want to maximize those standouts, but I don’t fear selling because I know that I can always find more plays when conditions are good.

This is the point you HAVE to reach.

There are a handful of skills you need to develop if you want to successfully siphon money from the market, and into your pocket.

Those skills are:

  • Identifying coins that have a good chance of catching hype
  • Picking good entries
  • Having a plan for cashing out profits

We’ll dive into each of these a little further, where I can give you some insight into my thought process.

That doesn’t mean that your process will be a carbon copy of mine, or that the plays you gravitate towards will be the same as me.

My goal is simply to get you to start thinking about being self-sufficient in your trading.

The only way to do that is to get dirty and lose some money.

Don’t want to lose any money?

Cool, you’ll never make any either.

The only way you learn to be self-sufficient in this game is to look at a lot of charts, make a lot of trades, and hone your radar in the process. 

For 99% of people, this means you are going to lose money along the way.

Consider it tuition.

Start with $500 and try to grow it. If you blow up your account, start with a fresh $500.

When you can consistently trade profitably, then you can start adding more fiat to your war chest.

This is a hard one for me to give directly actionable advice on. 

Some people look at volume, liquidity, on chain metrics, track whale wallets, and all sorts of other shit.

I don’t.

After being engrossed in crypto twitter for as long as I have, I simply go with my gut.

I know that’s not very helpful, so I’ll try to explain further.

Once you’ve been around crypto and crypto twitter for long enough, you start to see patterns. 

You’ll begin to get this gut feeling of “That seems like it could pump” or “That just doesn’t have it”.

These days, when I see a new coin on Twitter or Dex Screener, I’ll do a quick little rundown.

First, I see if it has any social media pages. 

If it does, I see what kind of content they are putting out. 

If I think it has the “it” factor, as subjective as that is, I’ll move on to the next step, which is making sure it’s safe to buy.

I have a post about buying meme coins safely, so I won’t rehash that here. 

I can’t give you this gut feeling.

There is no A+B formula I can sell you for $99.99 to identify coins in the same manner I do. 

I wish there was, because I would sell you that shit in a heartbeat. 

The truth is, you just have to keep trading and developing your radar through trial and error. 

That’s why it’s important to start with a small amount of money.

Then, when you most likely lose it, it’s a small price to pay for your market education.

Everything in this game is subjective, and picking entries is no different.

However, unlike identifying good coins to trade, I can give a little bit more actionable insights when it comes to picking entries picking entries.

At this stage, I typically don’t buy coins when they’ve crossed over the $10 million market cap mark, but that’s not a hard rule.

Most of the time I’m trying to get them sub $5 mil if they seem like they have a lot of potential. 

That’s on the higher end.

More often than not I’m trying to load up around or below $1 Million market cap.

But it’s largely dependent on the coin itself. 

Is it an original meme that’s getting a ton of hype, or is it a beta play?

Knowing where it lands in the hierarchy is important in understanding what kind of ceiling it could have. 

That knowledge will inform you on whether that $5-10 mil mc is a good entry, or nearing a peak.

Most of the time with these meme coins, you’ll see an initial spike on launch, followed by a retrace. 

The retrace is where you want to be buying if you’re catching launches somewhat early.

If you’re trading a more “established” coin, buying areas of accumulation or retests of trendlines is a great strategy. 

I prefer horizontal levels over trendlines, they seem to be more reliable.

That’s the great thing about trading these meme coins on chain. 

You get to see pure human psychology on display, without all the algorithmic trading bots fucking up chart patterns.

The biggest thing is to not get sucked into hype and buying vertical candles. 

It almost always ends up bad because you buy the top, get scared when it hits previous high (support) and you sell just in time to watch it reverse course and fly past your entry.

Wait for pullbacks to add, use pumps to take profits.

I’ve lost count of the number of times I’ve been up most people’s yearly salary on a single coin, only to leave the trade with a few thousand bucks.

All those big numbers in your wallet don’t mean shit until you sell your positions and put that money in the bank, or Bitcoin.

That’s why it’s important to have a strategy for taking profits.

If you don’t, you’ll get more and more drunk on hopium as the number climbs higher and higher… and then the music stops.

In a single hourly candle, your bag is cut in half, and you’re too paralyzed to sell. 

All you can think is “If it goes back to the highs, I’ll sell it all!”

But it doesn’t go back up. 

It keeps grinding down.

When you finally admit to yourself that it’s over, you’ve lost 80-90% of the value you had at the peak.

Your favorite influencer, the one you followed into the trade, is never going to tell you when he’s selling. 

You have to make that decision for yourself.

If you’re trying to grow a small bag, and want to be aggressive, a decent strategy is selling 25% after a 4X. 

That way, you can pull out your initial investment and can be speculative with the rest, knowing at the very least, you can’t LOSE money on the trade.

Another strategy is to set targets and decide you’ll pull a predetermined amount of profit every time your coin reaches certain market cap levels, or your position reaches certain fiat value benchmarks.

It doesn’t matter what you do, just as long as you have SOME strategy for taking profits.

Don’t be one of those people who makes life changing gains, then watches it all evaporate before their eyes.  

Again, none of your influencers are going to shill you good times to exit. 

They damn sure aren’t going to tell you they’re selling before they do it, because they don’t want to push the price down on themselves.

Have your own plan.

Trading is hard. 

The majority of traders lose money in the long run.

If you never learn to go through the entire trading process yourself, from picking trades to taking profits, you’ll never find yourself in that minority of winners. 

You’ll spend a decade “trading” and make no appreciable difference in your life.

Trading is hard, but it’s also rewarding. 

If you’re going to get into this game, then you may as well do it whole heartedly. 

Spend some time educating yourself. Learn basic technical analysis. Make sure you understand how blockchains work in general. 

Once you have a little information, start putting it into practice.

Knowledge may be power, but only if that knowledge is actually used.

You’ll learn 100 times more trading for 6 months than you will reading 20 different books on trading.

The only way you will develop the pattern recognition necessary to be good at this shit, is to spend a lot of time analyzing plays and seeing how they turn out.

Some people will advise that you “paper trade” at the start, so you can learn “without risking any money”.

I have an entire post on why that’s fucking stupid.

Trust me on this one. 

You’ll be far better off starting with a few hundred dollars, losing it, and repeating that process a few times as you learn.

That’s all for this one. 

Good luck with your future trading.

Until next time, 

Fractal

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