1. The most stable way to play crypto futures
Choose good coins and be a good person. As a leveraged trader, volatility can be amplified by the leverage multiple. The primary consideration in the trading process is not volatility but certainty.
Go long on strong coins in an upward market, and vice versa, go short on the weakest coins in a downward market.
For example, at the beginning of a new quarter, the strongest gains are eos and
eth, the first choice for buying dips are these two coins. When the price falls, the first choice for shorting is Bitcoin, even if the final result is that the decline of mainstream coins is greater than Bitcoin, only shorting or chasing shorts on Bitcoin can greatly avoid the risk of violent rebounds.
Most people in the currency circle are short-term traders. It is difficult to have the opportunity to insist on closing positions at the ideal point when trading. At the same time, they are not very proficient in position control, and they cannot rely on oscillating T to pull the average price. Based on this situation, for most traders, a good opening price is better than everything.
Once there is a profit, take some of it first and put it in your pocket, and set the cost price as a stop loss for the other part. This is also what I have always emphasized in my community.
The essence of futures trading strategy
(1) Identify the main trend and trade in the direction of the main trend. Otherwise, do not enter the market.
(2) If you are trading with the trend, position building point:
New breakout point of the trend;
Breakout point in the direction of horizontal consolidation;
Retracement point in an upward trend or rebound point in a downward trend.
(3) Positions in line with the trend will bring you rich profits. Never get off the bus early;
(4) If the position matches the big trend, and the book profit has proven you are right, you can add positions using the pyramid technique; (refer to 2)
(5) Keep the position unchanged until the trend reverses and close the position.
(6) If the market trend is opposite to the position, stop loss and run quickly.
In addition to adhering to the above strategies, remember 3 qualities: discipline, discipline, and discipline!
The way to trade is to accumulate small profits, and compounding is king. If you are out of cost, you must not become a loss again. If you have a profit, you must take some of it to prevent working in vain. Summarized in one sentence: If you have a profit, go boldly, and stop loss at the original price for the rest.
2. Tips for making money with perpetual contracts
1. Reduce full leverage.
How should funds be allocated? Capital allocation should be understood from two levels:
First, understand capital allocation from the perspective of risk. First, clarify how much loss our account can or is prepared to bear. This is the basis for our capital allocation thinking. After this total amount is determined, consider how many times we must lose to the market if we continuously lose in the market before we can willingly admit defeat.
Personally, I believe that the riskiest method should also be divided into three times. That is to say, you should give yourself at least three chances. For example, if the total amount of funds in the account is 200,000, and the client allows you to lose up to 20%, which is 40,000, then I suggest that your riskiest loss plan is: 10,000 for the first time, 10,000 for the second time, and 10,000 for the third time.
20,000. I think this loss plan still has a certain rationality. Because if you do it right once out of three times, you can make a profit or continue to survive in the market. Not being kicked out by the market is a success in itself and there is a chance to win.
2. Grasp the overall market trend.
Trends are much more difficult to do than oscillations, because trends are about chasing highs and killing lows, and you must have the determination to hold positions, while buying high and selling low is very in line with human nature.
In trading, the more you conform to human nature, the less money you will make. It is precisely because it is difficult that you make money.
In an upward trend, any violent retracement should be used to go long. Remember what I said about probability? So, if you are not on the bus, or you have gotten off, wait patiently. If there is a drop of 10~20%, boldly go long.
3. Specify profit and loss targets
Taking profit and stopping loss can be said to be the key to determining whether or not you can make a profit. In several transactions, we must ensure that the total profit is greater than the total loss. It is not difficult to achieve this. Just do the following:
Each stop loss ≤ 5% of total capital;
Each profit > 5% of total capital;
Total trading win rate > 50%
If the above requirements are met (profit/loss ratio greater than 1 and win rate greater than 50%), you can achieve profitability. Of course, you can also have a high profit/loss ratio and low win rate, or a low profit/loss ratio and high win rate. Anyway, as long as the total profit is positive, the total profit = initial principal x (average profit x win rate - average loss x loss rate).
4. Remember to avoid excessive and frequent trading.
Since BTC perpetual contracts are traded 24 hours a day, many novices operate every day, and they want to trade every day of the 22 trading days of the month. As the saying goes: If you walk by the river often, you are bound to get your feet wet? The more you operate, the more likely you are to make mistakes, and your mentality will deteriorate after making mistakes. Once your mentality deteriorates, you may act impulsively and choose "revenge" operations: possibly against the trend, possibly with heavy positions. This will lead to one wrong step after another, easily causing huge losses on the books, and these losses may not be recovered for several years.
3. What are the types of contracts?
Perpetual contracts: Perpetual contracts do not have an expiration date. Users can hold them indefinitely and close their positions themselves.
Delivery contracts: Delivery contracts have specific delivery dates, including weekly, bi-weekly, quarterly, and bi-quarterly delivery contracts. When the specific delivery date arrives, the system will automatically deliver regardless of profit or loss.
USDT-margined futures contracts: This means that you need to use the stablecoin USDT as collateral. As long as you have USDT in your account, you can trade futures contracts of multiple currencies, and profits and losses are settled in USDT.
Coin-margined futures contracts: These use the underlying coin as collateral. You need to hold the corresponding coin before trading, and profits and losses are settled in that coin.
I am A Yue, focusing on analysis and teaching, a mentor and friend on your investment journey! I hope that everyone who invests in the market can have a smooth journey. As an analyst, the most basic thing is to be able to help everyone make money. Solve your confusion, trapped orders, and operation suggestions. Speak with strength. When you are lost and don't know what to do, look at A Yue (homepage). A Yue will point you in the right direction$BTC #币安HODLer空投ERA
