In the crypto circle, there are only two risk controls for trading contracts:
1. Isolated margin, small position can allow for larger leverage.
2. Cross margin, heavy positions must have a stop loss.
There are only these two risk controls, there is no third effective option. Those who talk about averaging down are just holding positions, making it hard to earn money. It has no real significance.
Xiao O is currently using the first method, small position, not afraid of liquidation.
For those trading contracts, it's best not to open positions when going to bed at night; if you must, open very small positions.
Regarding the above title, how much stop loss is appropriate for opening a contract? Set the stop loss to a level where your position doesn't get liquidated, provided that your buying strategy is not going in the opposite direction. Due to high volatility, some stop losses are not significant; setting it within 1-5 points can easily be triggered.
So, you can set it according to your leverage and the volatility of the cryptocurrency.
For BTC, setting a 3% stop loss is sufficient. Sometimes with low volatility, even 1% may not be needed. This is mainly based on experience.
If your strategy is correct, remember to set a take profit. Referencing the above chart, if you bought in and made a profit of 10 points, failing to set a take profit could lead to regrettably losing your profit when it drops.
Stop loss must be set, if you are in profit, you must move to set a take profit.
As long as you make a profit, selling at any time is correct.
I am Xiao O, a professional analyst and teacher, a mentor and friend on your investment journey! As an analyst, the most basic thing is to help everyone make money. I will help you solve confusion and positions, speaking with strength. When you lose your direction and don't know what to do, follow Xiao O and I will guide you.