In the field of contract trading, most participants struggle to escape the trap of losses for the following reasons:

Excessive short-sightedness and disorderly operations: Some traders focus only on small-scale trends of 15 minutes, 30 minutes, or 1 hour, completely ignoring larger trends such as daily, weekly, or monthly charts. This leads them to frequently chase prices and sell off during small fluctuations, eager for high-frequency short-term trades. Due to a lack of rigorous trading plans, transaction fees consume a large portion of their capital, while profits remain minimal, and a slight misstep can lead to significant losses. When their actions contradict the major trend, they delay stop losses, ultimately resulting in liquidation.

Weak foundation and blind entry: Many beginners have no trading experience, only a partial understanding of technical indicators, and do not grasp market analysis. They have not built their own trading systems and enter trades based solely on intuition. If a novice rushes into the contract market without three years of chart observation and trading experience, it is essentially equivalent to seeking their own demise.

Misjudging strength and collapsing mentality: Some individuals mistake luck for their own trading skills; after a few profitable trades, they consider themselves trading experts. Thus, they borrow funds to trade cryptocurrencies and even quit their jobs to invest fully. However, under enormous pressure, emotions become uncontrolled, ultimately leading to failure.

Incorrect capital strategy: Using large amounts of capital for contract trading with the mentality of risking large for small gains, they hastily exit on minor profits while stubbornly holding onto losses. Such behavior in a one-sided market makes liquidation only a matter of time.

Therefore, it is advisable to participate in contract trading with small amounts of capital, seeking opportunities with high risk-reward ratios. Even in the event of liquidation, the losses will be small, while the returns can be substantial once profits are realized. Pursuing high risk-reward ratios to achieve small losses and large gains is the key to profitability in contract trading; conversely, small gains and large losses are the root causes of losses.