Contract profit techniques: Practical strategies that beginners can understand.
If you want to make money in perpetual contracts, the key is 'control your hands, calculate well, follow the trend'. Below are 5 practical tips summarized in simple language that even beginners can understand!
1. Capital allocation: Don’t go all in; leave enough 'trial-and-error capital'.
Core principle: First think about how much you can afford to lose, then divide the losses into several times.
Calculate the loss limit: For example, if you have 200,000 capital, the maximum loss you can accept is 20% (40,000); this 40,000 is the limit you can 'lose without feeling hurt'.
Try 3 times: Don't lose everything at once! Split 40,000 into 3 losses: first time 10,000, second time 10,000, third time 20,000.
Even if you lose the first two times, the third time still has a chance to turn around; as long as you win once out of three, you can break even or continue playing.
Remember: Staying alive gives you opportunities; don’t let the market kick you 'out of the game' all at once!
2. Grasp the trend: Go with the big direction, don’t be clever in small ways.
Core principle: When the trend comes, don’t act against it; a pullback is an opportunity.
How to act in an upward trend: For example, if Bitcoin keeps rising and suddenly drops by 10%-20%, don’t be afraid; buy boldly at this time!
Because when the trend is upward, a drop is often a 'false fall'; the probability of long-term growth is high, don’t let short-term fluctuations scare you away.
Why is it counterintuitive?: Everyone likes 'buy low and sell high', but trending markets require 'chasing highs and cutting losses'—dare to buy when prices go up and short when they go down; acting against human nature can lead to big profits.
3. Take profit and stop loss: Set rules; don’t operate based on feelings.
Core principle: Small losses, big gains; win more times than you lose.
Remember these 3 iron rules:
Every stop-loss (selling at a loss) ≤ 5% of total funds: For example, with 200,000 capital, the maximum loss per trade is 10,000; don't let a single trade lose too much.
Every profit (selling for money) > 5% of total funds: You should earn more than you lose, for example, at least earn over 10,000 before selling.
Win rate > 50%: Win more than 5 out of 10 trades, and you will make a profit in the long run.
4. Don’t trade frequently: Less operation, fewer mistakes.
Core principle: The more you trade, the more mistakes you make.
Common issue for beginners: Watching the market 24 hours a day, trading several times a day, can do over 20 trades a month. But 'if you walk by the river often, how can you not get your shoes wet'; the more you trade, the easier it is to lose your mindset.
Correct approach: Just check the market a few days a week, don’t trade every day. If you lose twice in a row, stop trading that day, calm down before making a decision. Don’t trade out of anger; 'revenge trading' will only lead to more losses!
5. Entry timing: Choose the right timing to reduce risks by half.
Core principle: Don't chase chaotic markets; wait for clear signals before acting.
Do not open positions in 3 situations:
When major good/bad news is released: For example, when a cryptocurrency suddenly announces significant news, the market will surge or plunge, easily triggering 'whipsaw' (instant rise and fall) stop-losses.
First fluctuation after a big rise or drop: For example, if the price suddenly rises by 20%, don’t rush to chase it; wait for the second pullback/rebound to stabilize before entering (lower risk).
When indicators are not in place: For example, if you set 'only buy when the price drops to 8,000', don’t act until it reaches that price; don’t be tempted by short-term fluctuations.