Not really, most people treat contracts as poison, unaware of the importance of knowledge. If you don't trade contracts, do you expect to get rich by hoarding big cakes?
Contracts are not scary, find the bottom to build positions. Before building positions, make sure to calculate the stop-loss level that you can bear the loss. If you're right, hold on; if you're wrong, stop-loss. Do it repeatedly, making money is that simple.
Many people treat contracts as poison because they see contracts as a gambling tool. Remember, classmates, we are speculators, not gamblers.
There are many experts in trading contracts. Here’s a bit of advice from me on trading contracts:
1) At low positions, just lay flat and avoid being washed out by the manipulators. Hold onto trend positions; if you want to earn, earn big; merely playing small won’t help.
2) Do not roll positions or average down when opening positions. Before opening an order, you must think of all possible bad situations and set up stop losses. If you average down later, it means you were wrong from the start. If you roll positions, you are likely to be liquidated by manipulators.
3) Freedom of long and short positions is encouraged, but I still recommend that you play contracts with a bullish mindset because the upside is limitless. Capturing one trend can yield substantial profits. To profit from shorting, you must continuously roll positions under trending conditions, but this can easily lead to being caught off guard by a rebound.
Now, let's talk about the seven taboos of contract trading.
1. Holding position syndrome is a common ailment for investors. Symptoms include: when there are no positions, feeling anxious and unable to resist placing an order; when holding positions, feeling panic, and not knowing what to do when the market moves in the opposite direction; thinking that opportunities are endless and wanting to operate continuously, resulting in increasing losses.
2. Frequent 'all-weather' trading. Many investors want to be all-rounders—'long' after 'short' and 'short' after 'long.' Although they demand a lot from themselves, this contradicts the importance of following the market's trend. Do not entertain reverse thoughts unless a force breaks another force. In a bull market, focus on going long, closing long, and going long again... In a bear market, stick to shorting, closing short, and shorting again.
3. Counter-trend attempts to catch rebounds. Can you catch rebounds? If the method is correct, of course. Otherwise, it’s like licking blood on a knife edge. If a knife falls from the sky, when should you catch it? Undoubtedly, it should be when it falls to the ground and is motionless; otherwise, you will be hurt badly. Catching rebounds requires certain skills; those without experience should not take risks and should follow the trend. Additionally, when participating in rebounds, one must pay attention to capital management.
4. Hesitating when placing orders. When going long, fearing a false breakout; when going short, fearing a false short, leading to missed opportunities. Understand the principle of inertia when a train starts. When the trend takes its first step, we should get in at one and a half steps until the balance is broken and the trend is established, adopting a 'take all orders' strategy. When signs of false breakouts appear, the chances of success when going the opposite direction are high.
5. The mindset of being watched by major players. Many investors have had this experience: you go long, and it drops; you short, and it rises; you cut losses on a long, and it rises again; you cut losses on a short, and it drops. Trading BTC is sometimes about luck; the major players don’t need you. Immediately turn off the computer, take a break, and come back calmly to trade again.
6. Full position trading. Trading with a full position can quickly increase wealth, but it is more likely to lead to rapid liquidation. Nothing is absolute; even funds cannot completely control sudden events and impacts from policies or news. Never go full position; each opening should not exceed 30% of total funds, at most 50%, to guard against averaging down or other situations.
7. Refusing to admit defeat. Many investors are stubborn; they refuse to admit mistakes, failing to resolve wrong positions immediately, causing errors to continue. The consequences are foreseeable. 'I just don’t believe it won’t rise; I just don’t believe it won’t drop...' This mindset is absolutely unacceptable. When admitting mistakes, do not harbor any illusions; decisively stop losses at the first moment.
So how do we correctly play contract trading?
After more than ten years of trading cryptocurrencies, I realized the only secret to playing contracts after experiencing five liquidation pains in the first few years!
First: How to get started with market charts.
Since we are playing contracts, we should know the most basic common sense.
Since we are playing contracts, we cannot do without market analysis charts. Friends who have dealt with stocks, futures, or spot trading are certainly familiar with this, but for beginners, it can be a bit confusing.
1. In the chart, the bars formed by red and green are called candlestick charts or K-line charts.
2. Each bar represents the market trend for each time period; for example, the chart shows a 15-minute chart (circled in the upper left corner). Each of these bars represents the trend for each 15 minutes. For example, starting at 12:00, a candlestick forms at 12:15, and another candlestick forms at 12:30. When switching to a 30-minute chart, each candlestick represents the trend for each 30 minutes, and so on.
3. The green group forms what is known as a bullish line, indicating an upward trend, while the red group forms what is known as a bearish line, indicating a downward trend.
Second: How to draw trend lines
Trend lines are the most commonly used method for analysis.
1. Upward channel trend line (the upper line segment): Connect the previous high point with the second high point (the high point from a little earlier) and extend it (as shown in the diagram).
What is a high point?
In simple terms, it's like walking from a mountain to a hillside, then to a hill, and finally to a plain. When you are on the plain, that big mountain is your previous high point, and the hill you just passed is your second high point (if you can't understand this, then I...).
2. Downward channel trend line (the lower line segment): Connect the previous point with the second lowest point (the low point from a little earlier) and extend it (as shown in the diagram).
After understanding the high points, think of the low points as the opposite of high points.
The role of trend lines: If the candlestick chart breaks through the upward channel, the market will rise; if it breaks through the downward channel, the market will fall.
Third: Judging resistance (lines) and support (lines).
Method for drawing resistance lines: The previous high points are the drawing points, parallel and extended, as shown in the diagram.
Method for drawing support lines: The previous low points are the drawing points, parallel and extended, as shown in the diagram.
Resistance line: It is a judgment of whether the market will continue to rise to a certain position when the market rises. When placing an order (taking long positions as an example), the resistance level can be the maximum profit point for this order, which is the take-profit point (considering specific situations and specific market locations).
Support level: It is a judgment of whether the market will continue to decline to a certain position when it drops. If it drops effectively, the market will continue to fall. When placing an order (taking long positions as an example), the support level can be used as the stop-loss point for this order. (Considering specific situations and specific market positions, the methods differ, and the stop-loss and take-profit points are different).
Here we will talk about effective and ineffective breakthroughs. There are also examples in the chart. Only after the body of the candlestick effectively breaks through can it be considered a point of evaluation. If there is no body breakthrough, it is just a line (commonly known as a spike) and is considered ineffective.
Fourth: Judging and utilizing the golden cross and dead cross in the (MACD chart).
The MACD chart is also used to determine whether the market is in an uptrend or downtrend.
The yellow area circled at the bottom of the chart is called the MACD chart.
The MACD chart has golden crosses and dead crosses; the upward line segment is called a golden cross, indicating an upward trend.
The downward line segment is called a dead cross, indicating a downward trend.
The length of the lines represents the strength or weakness of their upward or downward trends.
Use the MACD chart in conjunction with trend lines to analyze market trends.
Fifth: Combining analysis methods for short positions as an example (three-point comparison method).
Taking the market in the chart as an example, there are three high points, but each high point is lower than the last (high point lower than high point). At this time, we can determine to open a short position based on the trend line and the MACD chart's movements.
Why understand this way? Because each upward wave of the market has not broken through the previous resistance level and is lower each time, we can determine that the overall trend of the market is gradually declining.
When the third high point starts to decline, if it effectively breaks below the support level (previous knowledge point), the market will continue to decline.
Sixth: Conduct grid trading based on Bollinger Bands (quick entry and exit method).
3. Opening long positions at the lower band means starting to open long positions when the market reaches the lower band of the Bollinger Bands.
Bollinger Bands are divided into upper band, middle band, and lower band.
The principle of this method is: (15-minute, 30-minute lines) 1. Opening short positions at the upper band means starting to open short positions when the market reaches the upper band of the Bollinger Bands. Control the position to about one-tenth of your total position and sell after making a profit.
2. Double opening at the middle band (opening both long and short positions simultaneously). Regarding this method, when you double open, regardless of whether the market rises or falls, you will have one profitable position. From the perspective of an upward trend, after double opening at the middle band, if the market reaches the upper band, you can take profit from the long position and then close it. Then open a short position, which means you have a total of two short positions. When the second short position falls to the middle band, the loss from the first short position (the double opened short position) is compensated, and overall, the long position is profitable.
When the market breaks through the upper band of the Bollinger Bands or the lower band, we choose to lock in positions, which means hedging. At this time, open a position in the opposite direction of the current order, which will keep the overall profit and loss of the market stable, neither increasing nor decreasing. Additionally, move along with the current upward or downward trend and add another position.
Under the premise that the current market is controlled, another position is in a profitable state. If the profit point can match the total profit and loss point of the locked position, then we have achieved a break-even result.
As for the locked positions, if the market retraces or adjusts, then the locked positions can be released.
The Bollinger Bands method is suitable for broken line operations; remember that all positions should be controlled to one-tenth of your total position.
Seventh: Use the 'Ten' heart to determine the upward trend of the market.
When the market shows a 'Ten' pattern on the 15-minute or 30-minute chart, we choose to enter a long position.
Emphasis: This is a pattern in the market, and of course, there are no absolutes. The 'Ten' heart is the same, but most of the time when encountering this situation, one can directly enter a long position and quickly exit.
Note: The 'Ten' heart must be standard, perfectly aligned vertically and horizontally, with equal line thickness for the 'Ten' pattern.
1. Never chase high prices when buying coins; have the mentality that it can rise as much as it wants; treat it as if the coin doesn’t exist.
2. There are only two types of coins: the coins bought at good points are good coins; otherwise, they are garbage coins. The larger the scale of the buying point, the better the quality of the coin. Patience is required to wait for the larger scale to build up to become a true quality stock; this is the real mentality.
3. In fact, the mindset is the most important in trading cryptocurrencies. Many people clearly know it’s not a buying point, yet they can’t resist the urge to buy; this is a mindset issue. If this is not resolved, no theory will be useful.
4. Maintain a steady mindset; do not have emotions towards any coin or price point, only look at the market's signals. One should have feelings towards buying and selling points. If the skills are good and the funds are large, for example, if one can operate on a 30-minute basis, then there is no such thing as being late.
5. The reasons for mistakes are always unrelated to the market; to find the reasons, one can only look for their own reasons. Every mistake must be summarized immediately.
6. The mindset of being eager to make money is a big taboo for us cryptocurrency traders. If one cannot control their own desires and greed, they cannot succeed in the market for long. There are two forms of emptiness: when holding coins, the mindset is controlled by the bulls; conversely, one becomes a slave to the bears. The market's emotions accumulate and are guided by this. Those who cannot escape this state will forever be false market participants.
7. Trading cryptocurrencies tests long-term profitability rather than the ability to explode once. The key is a long-term effective trading strategy. When buying, consider all potential scenarios; hold firmly, and sell decisively to gradually improve. You trade coins, not coins trading you; start with yourself.
8. The virtual currency market will only reward those who are patient; any good coin needs to be nurtured. Constantly changing coins will definitely lead to small funds and minor profits. Focus on one point; those who run around every day will never earn big money.
9. Dance to the rhythm of the market. As long as you follow the market's rhythm, you can move lightly on the edge of a knife. Rhythm is always the market's rhythm; a market participant without a sense of rhythm is always waiting for torment. Set aside your greed and fear and listen to the market's rhythm. As long as you can follow the rhythm, no one can stop you. The market has rhythm; grasp the current rhythm, and no one can defeat you.
10. When playing with capital, remember that the power of compound interest is the greatest. As long as you have a good mindset and skills, compound interest is inevitable, and this can overcome everything.
Old Wang only trades in real-time, and there are positions available in the team, come quickly #九月加密市场能否突破？ .
