Many friends find the term 'rollover' quite intimidating. In fact, a different way to say it is: 'adding to positions with floating profits.' Doesn't that sound much better? 'Adding to positions with floating profits' is a very common operational technique in contract trading, and it doesn't require too high a leverage ratio.
Very suitable for friends who want to trade contracts with low leverage, almost ensuring the absolute safety of the position.
Three situations suitable for rolling positions:
1. Choosing a direction after a long-term sideways volatility reaches a new low.
2. Buying the dip after a significant drop in a bull market rally.
3. Breaking through major resistance/support levels at the axis level.
(Friendly reminder: Only use funds that you can afford to lose to trade contracts.)
What is rolling positions?
In a trending market, after significantly profiting using leverage, the overall leverage passively decreases. To achieve compound profit effects, increase trend positions at the 'right time.' This process of increasing positions is called 'rolling positions.'
The 'right time' mentioned here refers to
1. Add to positions during converging breakout trends, and quickly reduce the added positions after the breakout until the main upward wave.
2. Increase trend positions during pullbacks in a trend, such as buying and distributing when it retraces to the moving average.
Of course, successful rolling positions have particularly high requirements for market conditions. You might hit your stop loss 9 out of 10 times (this probability will be even lower in actual trading because you can't always catch a trend). Therefore, rolling positions have very high requirements for the risk-reward ratio, which means that in order to continuously experiment and catch trends, the size of each position must be small enough that you wouldn't mind losing that money. This point is crucial and can be understood as the essence of rolling positions. Rolling positions do not care about the size of the initial position; a strong upward trend can turn a very small initial position into an infinitely large one, up to the point where the exchange limits your ability to add to your position. Rolling positions are a process of continuous experimentation, and the worst mistake is to go all-in recklessly. This discipline must be observed.
Everyone has a different approach to contract trading. The premise is to find a set of operations that belong to you so that you can be self-sufficient in the cryptocurrency world, continuously improving your trading methods through learning. One should not be too impatient or hasty, as it will only lead to confusion and irrational decisions, which is the last thing we want to see.
True investment is not just about accumulating money; more valuable is the expansion of connections, broadening of vision, continuous upgrading of life's perspective, improvement in emotional intelligence in various aspects of life, and constant iteration and adjustment of values, truly becoming the master of wealth.
