Senior Trader's 2024 "Manual of Mastery": How to Capture Opportunities from Volatility and Protect Profits

Author: Nancy, PANews

In 2024, the cryptocurrency market experienced a tumultuous year filled with volatility and development, with Bitcoin breaking the $100,000 mark, opening a new chapter for the industry. In this ever-changing market, some traders lost their way due to factors such as loss of control over their mindset, poor position management, information lag, and lack of strategy. Of course, there were also traders who successfully seized market opportunities and achieved considerable returns through precise decision-making, decisive actions, and deep market insights.

Amidst the alternating prosperity and decline of the market, effectively balancing risk and return, and adjusting strategies to cope with different market fluctuations are key factors determining whether one can profit in the cryptocurrency market in the long term. In this article, PANews shares the operational experiences and investment lessons of several seasoned traders interviewed and compiled, exploring how to optimize trading strategies, capture market opportunities, and secure profits.

Trading Reflections: Risk, Strategy, and Emotion

In the volatility and uncertainty of the cryptocurrency market, the experiences and lessons of traders provide valuable insights. Whether adopting a robust investment strategy or speculating on short-term opportunities, risk management, strategy adjustment, and emotional control are particularly important in trading.

Amanda, CIO of Chainup Investment, has over seven years of cryptocurrency trading experience, and she flexibly adjusted her strategies this year based on market changes. For example, in Q1, she selected several potential projects, including AI tokens RENDER, FET, and AIOZ, as well as DeFi tokens RBN, PENDLE, and INJ. By Q4, in addition to investing in IOTA, she actively purchased DOGE, PEPE, and some politically themed MEME coins, while also holding multiple projects such as RSR, DYDX, LQTY, and KAIA. At the same time, Amanda also paid great attention to short-term speculative opportunities. In November, she increased her positions to capture the benefits of the Trump Trade and exited in time to secure profits. However, she also revealed some regrets in the interview, such as missing the opportunity to heavily invest in SOL and MEME in the first half of the year, and while she successfully captured profits in the first half of SUI, she failed to fully grasp its subsequent gains.

CashCashBot founder "Sabi Ge" has also accumulated rich trading experience in the cryptocurrency field, with a trading history of seven years allowing him to navigate the market with ease. In the interview, he revealed that he achieved good results in MEME sector investments this year, particularly with MOODENG's staggering 5000x increase, bringing in $350,000 in profits.

With three years of trading experience, cryptocurrency KOL LaserCat397 is a deep player in the MEME track, achieving overall asset growth this year through investments in MEME coins. However, he also faced challenges in investment judgment and position management, such as a misstep in trading the MEME coin PUPS, which led to a nearly 90% drawdown in floating profits.

In contrast, Alex, VP of Cobo with six years of trading experience, adopted a conservative investment strategy. His most successful trade this year came from Bitcoin, while his biggest regret was participating in the airdrop events of aevo and vertex, missing the opportunity with Hyperliquid.

Top trader Eugene has also recently summarized his experiences and lessons in trading, especially regarding the mistakes of neglecting stop-loss points and failing to stop losses in time. He revealed that due to SOL's strong performance on low time frames (LTF) and the confidence gained from previous successful trades, he went long on SOL with $60 million. However, when SOL fell below the stop-loss point, he chose to continue holding, maintaining a 'hopeful' mindset, which led to the largest single loss in his account.

Survival Guide from Tools to Mindset

In trading decisions, many successful traders leverage third-party tools to assist in decision-making, improving efficiency and accuracy, thereby reducing decision-making errors. These tools can help capture market signals, analyze on-chain data, and provide real-time feedback, enabling traders to better grasp the market's pulse.

Amanda revealed in the interview that her team developed a data monitoring platform and customized on-chain data tools, such as Dune and Flipside. Additionally, the team uses CryptoQuant, Coinglass, Artemis, Defillama, and Kaito to observe Bitcoin on-chain data, exchange contract data, and public chain indicators to help make more precise investment decisions.

"Sabi Ge" believes that on-chain data analysis is crucial for capturing market trends in advance. He uses on-chain trading signals and data analysis tools provided by his own developed CashCashBot to quickly identify which market hotspots are attracting smart money and the potential investment directions of on-chain main forces. LaserCat397 mentioned that he used Abot, but this tool is about to shut down.

Although leveraging third-party tools can enhance trading performance, trading in the highly volatile and high-risk cryptocurrency market is not easy, and even experienced traders cannot guarantee that all judgments are correct. Therefore, survival experience is particularly valuable, especially for novice traders.

Cryptocurrency analyst Altcoin Sherpa pointed out that a bull market does not mean that all coins will return to ATH (all-time high) levels, and one should not stubbornly hold out for unrealistic target prices. If the investment portfolio is highly diversified, it is advisable to sell 50-75% of holdings at the end of the next rotation. Additionally, one should continuously analyze data weekly, constantly reassessing the market cycle's peaks and endpoints, and independently analyze and operate their investment portfolio.

"The most successful traders do not achieve their current success by perfectly timing every peak. If you have unrealized profits that can change your life, you gain a benefit that cannot be measured in money: a permanent improvement in your life and the lives of those around you," noted cryptocurrency researcher Route 2 FI.

Former TradFi CTO @Game believes that investors should focus on key areas, combining capital scale, advantages, and market conditions to concentrate on the fields that best match current market conditions and can yield the highest returns. They should also clarify their operational methods in investment, trading, and speculation, and develop a clear action plan (market cap range, stop-loss points, profit plans, etc.) along with continuous reflection. Furthermore, they should not work in isolation but expand their horizons to gather important information that provides insights into macro trends, market cycles, and more.

Cryptocurrency KOL Based Money Lich King summarized dozens of survival rules, such as not recklessly using perpetual contracts, not blindly worshiping founders, not locking up your tokens, not buying assets that have surged, not connecting to unfamiliar applications casually, and remembering to take profits, among other practical advice.

Amanda suggests that newcomers should keep an open mind, always pay attention to market dynamics, focus on areas they understand, and find the positive and negative balance of projects. Only when they can accept the negatives of a project, and the positives far outweigh the negatives, should they invest. "Sabi Ge" emphasizes that on-chain data analysis skills are essential for every trader, and one must establish a trading strategy that suits them and strictly adhere to it. Alex believes that cultivating the right mindset is key, as a good mindset helps make calm decisions. LaserCat397 advises newcomers to start from their areas of strength, find a suitable track for themselves, and focus on doing what they are good at, which will yield better results with less effort.

Strategy Optimization from Opportunity Capture to Profit Preservation

In the context of changing market environments, adjusting trading strategies and methods is also crucial for accelerating returns. From the traders' sharing, it is evident that we should respond flexibly to market changes and continuously evaluate and optimize trading strategies based on our own situations, finding opportunities in short-term market fluctuations while maintaining flexibility and sensitivity in long-term trends.

Alex candidly stated in the interview that the cryptocurrency market experienced significant drawdowns in March this year, particularly in August and September when market liquidity was extremely low. During this phase, his personal strategy was to withdraw funds from the market and invest in neutral strategies in DeFi and arbitrage. He believes that as the cryptocurrency market becomes increasingly professional, the returns from previous funding fee arbitrage strategies are gradually diminishing, necessitating the search for new opportunities, with strategies increasingly shifting on-chain.

"Previously, the trading path was BTC to ETH, then to large coins and small coins; but now it's BTC to SOL, then to small coins. The issuance of stablecoins has a more significant impact on the performance of small coins," Amanda pointed out. During market fluctuations, appropriate rebalancing and profit-taking are necessary. Risk management is very important; generally speaking, she categorizes each investment token/project before making decisions, assessing whether the project has fundamentals, whether it has momentum, and whether it is driven by technology. For example, projects with fundamentals can have their positions increased appropriately, while for projects with momentum, it is essential to judge the sustainability of that momentum and pay attention to potential catalysts (as the crypto space is still an inefficient market, it is crucial to pursue market consensus; discovering Alpha too early also carries significant opportunity costs). For projects driven by technical factors, close attention must be paid to price trends. She emphasizes that in a bear market, it is essential to reduce exposure to coins with suboptimal economic models, while in a bull market, one must be more sensitive in adjusting strategies, trading frequently, and taking profits.

In "Sabi Ge's" view, this year's market is more focused on on-chain MEME. He believes that changes in on-chain data provide high-value reference signals that were previously unavailable on exchanges, allowing for more precise trading strategies. For instance, trading strategies can be adjusted by analyzing changes in on-chain main force holding data.

LaserCat397 stated in an interview that the market was very difficult to operate in mid-year, advising everyone to take fewer actions and observe more, waiting for the best timing. In a bull market, one needs to broaden their perspective and then hold on.

Altcoin Sherpa indicated that in the near future, investors should try to consolidate their investments, reducing the number of new positions opened and lowering the overall variety of holdings. In the recent wave of rising markets, he has sold many low-confidence coins and reallocated funds to other higher-quality projects.

"Making money in the cryptocurrency market is one thing; preserving profits is another. When planning your exit strategy for a cycle, the goal is to minimize drawdowns from the highest point after a cycle shift. For those who claim to be able to profit in both bull and bear markets, I can only wish you good luck, as this means you must become one of the top 0.01% of traders in the world," Eugene emphasized.

2025: Trader Perspectives on Potential Sectors and Investment Opportunities

In the atmosphere of a bull market, major global institutions have recently released their outlooks and predictions for the cryptocurrency market in 2025. From a trader's perspective, 2025 will be a more diversified and mature market, with various emerging sectors and technologies likely becoming new growth points.

Altcoin Sherpa pointed out that the cryptocurrency market is expected to enter a new upward phase in the next 4-8 weeks, mainly driven by factors such as Bitcoin's dominance (btc.d) being at a high level, seasonal factors, potential rises in Ethereum/Bitcoin, market capital rotation, and a shift in government attitudes. However, from a rotation perspective, it seems that all coins will rise, but there is no trend of comprehensive increases. From now on, the market will primarily belong to traders rather than long-term holders.

LaserCat397 believes that 2025 will still be the main stage for the MEME sector. In addition, he is particularly optimistic about the performance of infrastructure projects, especially in the payment sector. "Sabi Ge" envisions 2025 as a year of large-scale popularization for the cryptocurrency market. He believes that compared to the past, various infrastructures will be significantly improved, leading to more users and capital flowing into the market. Particularly, MEME coins, due to their simplicity and strong dissemination capabilities, are likely to become the preferred sector for new traffic entering the market.

Alex also holds an optimistic view of the market outlook for 2025, believing that the future focus will primarily be on AI, DeFi, and payment sectors. Amanda pointed out that 2025 may be the latter half of the crypto bull market, with significant growth potential for small coins. She reminds investors to pay attention to "top signals," which refer to shifts in market signals and high-risk timing, while emphasizing the importance of "being Sifu"—exiting the market at the right time to avoid being swallowed by market fluctuations. In terms of specific sector selection, she is optimistic about the overall growth potential of AI, especially AI agents, Move language (more choices for RWA, BTC L2, Chain Abstraction, new DeFi), and RWA-related projects.

Eugene is optimistic about the MEME market and recently specifically mentioned four MEME coins: MOODENG, CHILLGUY, PNUT, and GOAT. He believes that although these MEME coins have experienced significant panic selling and have retraced most of their gains from the altcoin season, he still views these projects positively and tends to consider them as long-term investment targets.