From liquidation to guaranteed profits: The three 'keys' of contracts in the crypto world, learn these three moves to avoid three years of detours.

From liquidation to guaranteed profits: The three 'keys' of contracts in the crypto world, learn these three moves to avoid three years of detours

A fan named Ahao sent a screenshot yesterday: 'Bro, I finally dare to say I understand contracts — last week, grid trading earned me 3000U, without watching the market or staying up late, and I didn’t get liquidated.' Who would have thought that six months ago, he was a standard 'retail investor': guessing rises and falls by refreshing forums, opening full positions with 10x leverage, and getting liquidated twice in three days, not even knowing what the funding rate was.

From being liquidated to making profits, it’s not about suddenly getting it; it’s about understanding the three 'keys' of contracts: the underlying logic of directional judgment, advanced gameplay of strategy combinations, and the lifeline of risk control. These three moves look simple, but they can help you avoid 80% of liquidation pits — Ahao rolled from 500U to 50,000U using them, and today I’ll break it down for you, so you can get started after reading.

The first key: directional judgment — don’t treat contracts as a gamble; calculating win rates is more important than guessing rises and falls.

When Ahao first entered the market, he always thought 'going long means betting on price increase, going short means betting on price decrease,' and as a result, opening orders with 10x leverage felt like rolling dice, winning or losing depended entirely on luck. Later, he understood: contracts are a 'probability game,' not a 'gambling table,' learning to calculate win rates is 10 times more reliable than guessing directions.

① Before opening an order, draw the 'lifeline': use support and resistance to determine direction

Now he always draws two lines on the K-line chart before opening an order:

- Support level (equivalent to 'safety cushion'): the price that has recently dipped below and then bounced back three times, such as BTC's 116,000.

- Resistance level (equivalent to 'ceiling'): the price that has recently peaked and then retreated three times, such as BTC's 120,000

If the price stabilizes at the resistance level, go long; if it breaks below the support level, go short; during sideways movement, resolutely hold your position. This move raised his win rate from 30% to 65% — last year, when ETH broke the 2700 resistance level, he followed through and went long, earning 1200U; when it broke the 2500 support level, he shorted and made another 800U, profiting from both sides.

② Leverage is not a 'magnifier'; it’s an 'accelerator.'

10x leverage doesn’t mean you earn 10 times; it’s 'using 1U to leverage 10U opportunities.' Ahao calculated a figure:

1000U principal opens 10x leverage, actually using a 10,000U position

- A 1% increase earns 100U (equivalent to 10% of the principal), but a 1% drop also loses 100U.

- Including transaction fees and funding fees, it needs to rise 1.5% to break even.

Now he only uses 3-5x leverage, earning slowly but steadily. One time, a fan named Old Zhou laughed at him for being 'cowardly'; he went all in on ETH with 10x leverage, but after a 5% pullback, he was liquidated, while Ahao with 5x leverage weathered the volatility and ultimately made a profit of 300U.

③ Don’t guess 'which side up'; wait until the 'coin lands' before taking action.

The most foolish thing is opening orders blindly during sideways movement. For example, when BTC fluctuated between 100,000 and 110,000, Ahao used to be unable to resist guessing the direction, resulting in 4 losses out of 5 trades. Now he waits for the 'coin to land' — chasing long after breaking 110,000, and chasing short after breaking 100,000; although he misses the initial 10% profit, he avoids 80% of the sideways traps.

'I used to think waiting for a breakthrough would cause me to miss opportunities; now I understand that missing is better than making a mistake.' In his delivery orders, 30% of the time is in cash, but the profit is twice what it used to be.

The second key: strategy combination — let the market automatically 'send money,' passive earning is more reliable than watching the market.

Relying purely on guessing rises and falls is for retail investors; those who use strategy combinations are the sickle. Ahao now relies on three 'automatic profit-making' strategies, requiring less market watching while still making guaranteed profits:

① Grid trading: the 'automatic ATM' in a volatile market.

Last year, when BTC consolidated between 90,000 and 105,000 for 20 days, Ahao set up a grid:

- Automatically buy 100U every time it drops by 500U (for example, buy 100U at 90,000, then buy another 100U at 89,500).

- Automatically sell 100U every time it rises by 500U (for example, sell 100U at 105,500, then sell another 100U at 106,000).

After 20 days, the system automatically bought low and sold high, earning 2300U, more than his manual trading. The core is: The larger the fluctuation, the more you earn, but if the sideways range is less than 3%, don’t use it; the transaction fees will eat into the profits.

② Funding fee arbitrage: Zero-risk 'sheep shearing.'

He discovered a secret: when the contract funding rate is very high (for example, >0.15%), you can open simultaneously:

- Buy 1000U of ETH in the spot market (going long).

- Open a 1000U ETH short position (short selling) in the contract market

This way, regardless of rising or falling, he can earn funding fees (when long traders pay short traders, the short position earns the fee rate; vice versa). Last year, relying on this move, he earned 500-800U every month, with zero risk, and beginners could also practice.

③ Hedging strategy: Pick up money during black swan events; the greater the volatility, the more you earn.

Previously, when FTX collapsed, the market was a mess, but Ahao earned 12,000U, relying on hedging:

- Open a 5000U BTC long position (to prevent a price surge).

- Simultaneously open a 5000U BTC short position (to prevent a crash)

- Set a stop loss; take profit on whichever side makes money

As a result, BTC first fell and then rose; he closed his short position and earned 6000U, then closed his long position and earned another 6000U; the greater the fluctuation, the more he earns. This move is suitable for sudden black swan events, helping you stay calm in chaos.

The third key: risk control — survive to be qualified to make money; these three lines are engraved on his phone case.

After being liquidated twice, Ahao understood: The key to making money in contracts isn’t how much you can earn, but how not to die. He set these three lifelines as his phone wallpaper:

① Position = lifeline: Open orders with 1% of the principal; you won’t die even if you make 100 mistakes.

With a 50,000U principal, he only uses 500U (1%) for each order, with 3x leverage and a stop loss of 5% — even if he makes mistakes 20 times in a row, he only loses 5000U, still having 45,000U left. He has seen too many people open positions with 50% of their capital; one wrong order wipes them out, 'although 1% position is slow, it allows you to survive.'

② Stop loss = brake: 'Write down the retreat route' when opening an order

Now he always sets a stop loss when opening an order; for example, if he goes long on ETH to 2000U, he sets the stop loss at 1900U (a 5% drop), automatically closing when the point is reached, never holding a position. Once, he foolishly turned off the stop loss thinking 'just wait a bit longer', resulting in a loss of 3000U, and from then on, he never dared to touch the stop loss button again.

③ Emotion = devil: Three consecutive stop losses, forced to hold cash for three days.

Ahao set a reminder: if he has three consecutive stop losses, the alarm goes off; when it does, he closes the software, goes out for a run or a movie, and doesn’t touch contracts for three days. This move helped him avoid six emotional top-ups, saving at least 20,000U.

Two iron rules that beginners must remember, more useful than any technique.

- Keep 12 months of living expenses: Ahao split his 50,000U into two parts, 30,000U for trading, 20,000U saved in the bank for living expenses, so even if he loses in trading, it doesn’t affect his meals.

- Don’t believe in 'mystical indicators': Turn off KDJ, MACD, only look at support, resistance, and trading volume, 'indicators are for retail investors; the sickle only looks at the flow of real money.'

The three stages from retail investor to sickle are written in Ahao's practical notes:

- First month: Learn to draw support and resistance, practice with 1% position, first guarantee no liquidation

- Third month: Practice grid trading, make small money in a volatile market, cultivate a 'non-greedy' mindset

- Sixth month: Add funding fee arbitrage, combine strategies to resist risks, achieve stable monthly returns of 10%-15%.

Finally, here’s a saying for beginners: Contracts aren’t a gambling table; they are a battlefield. Retail investors swing their knives randomly, while the sickle attacks with a shield — how long you can survive doesn’t depend on how good your knife skills are, but how hard your shield is.

Starting next week, he will practice a 'grid + arbitrage' combination, starting with making small profits, set according to the chart, making money in a volatile market. If you want to learn together, you can follow @bit多多. Remember: Ahao was able to turn 500U into something more, not because he was smart, but because he learned 'not to be liquidated' — these three words are worth the lessons from 100 liquidations.

The ultimate secret of contracts is not predicting rises and falls, but letting profits run and stopping risks. Once you learn this move, you’re not far from the sickle.