If you must trade contracts, remember the following points! Very important!!!
1. Trading contracts is about risking a little for a lot, experiencing losses is normal. However, after hitting a stop loss, two types of people emerge: some will frantically open new positions, while others will enter a calm period. My advice is that if you encounter frequent stop losses, you should calm down, temporarily stop trading, and adjust your strategy.
2. Don’t rush to succeed; trading is not a means to get rich overnight. When facing losses in trading, maintain a calm mindset, don’t rush to open new positions, and definitely don’t go all in.
3. It's important to recognize the overall trend. When you see a one-sided market, you should follow the trend; do not trade against it. Trading against the trend is the root of losses. Whether you are a beginner or an experienced trader, there is a habit of trading against the trend. However, once the market trend is established, trading against it often leads to severe lessons from the market. Therefore, we must learn to follow the trend and patiently wait for opportunities to act.
4. You must manage your risk-reward ratio well; otherwise, it will be difficult to make money. Ensure that profits are as large as possible compared to losses, and at least maintain a 2:1 ratio before considering opening a position.
5. Frequent trading is a major taboo in contracts. If you are not a contract expert, you must control the impulse to blindly open positions, especially for new players who are full of enthusiasm for the market and always want to seize every opportunity. However, most so-called opportunities will lead to losses.
6. Only earn money within your understanding; this is very important.
7. Do not hold onto losing positions. Holding onto contracts is a major taboo, especially for beginners. You must manage your stop losses well; holding onto positions is the beginning of a downward spiral. Again, do not hold onto positions.
8. When in profit, do not become complacent; complacency will lead to losses.