Why are liquidations frequent? It is merely the dual imbalance of leverage and position.
Why are liquidations frequent? It is merely having leverage too high, like walking on a tightrope over a cliff; dare you go all in on 100x leverage?
That is betting tomorrow with principal; merely having over-leveraged positions is like rolling dice; using 10x leverage while still heavily invested? That's gambling with your account. Leverage and position are two ends of the risk balance: high leverage must be paired with very low positions, walking on thin ice for safety; low leverage can accommodate moderate positions, ensuring steady progress for the long term.
Why complain about the market? The real defense lies in capital management.
Why complain about extreme market conditions? The market is inherently volatile, experiencing both sharp rises and falls; this is a rule, not an accident. Why lament the ferocity of bulls and bears? Fluctuation is the norm in contracts; this is a rule, not injustice.
No matter how fierce the wind and rain outside, what does it have to do with us? We only need to keep an eye on our capital account, setting the liquidation line as a safe bottom line, making it unreachable even in extreme markets; adjusting our positions as protective armor, so that no matter how fierce the bulls and bears are, they cannot hurt our capital. What is the safest strategy? It is to lock the funds in a safe, occasionally opening a window for ventilation, rather than exposing them to the line of fire; it is to make the liquidation line a moat, always far away, rather than within arm's reach.
Extreme position management: the iron law of survival in contract trading.
As long as the green mountains remain, we are not afraid of not having firewood; this is not retreating, but leaving room for the future. Half positions are not conservative; they are the wisdom of being able to attack and defend. Dynamic adjustment is not arbitrary; it is the strategy of responding to market changes.
If spot trading is this cautious, contracts should be even more careful: at high leverage, positions must be as low as dust to withstand the storm; at low leverage, positions must be as steady as a rock to weather the clouds.
Conclusion: Position management is the art of dialogue with the market.
Extensive position management is the core of contract trading, a barrier to capital safety, and the key to long-term survival. It allows you not to be overly joyous during a surge because there is room left in your position; not to panic during a crash because the liquidation point is far below.
A full position is the mentality of a gambler putting all on the line; a light position is the wisdom of a general strategizing; dynamic balance is the ultimate rule of dancing with the market. When your position allows the liquidation line to become a distant dream, every market fluctuation will become a stepping stone for your wealth accumulation.
In the cryptocurrency market, only this type of person makes money; it does not depend on what techniques and methods you use, but on your self-discipline. Trading in the crypto market is sometimes not a contest of strategies but a contest of time and patience. Playing back and forth in the crypto space is essentially a struggle between retail investors and institutions. If you lack cutting-edge news and firsthand information, you can only be cut! If you want to strategize together and harvest from the institutions, you can follow me!
Welcome like-minded people in the crypto community to discuss together!
