For novice players, if you invest 30,000 to 50,000 in trading cryptocurrencies or contracts, it is definitely not worth it. Taking 50,000 as the principal, for example, with ETH perpetual contracts, a 30% drop means a 100% loss, and with 100x leverage, you would lose 5,000. That's a large portion of most people's monthly salary, which is really quite significant. Moreover, for beginners, even 50,000 seems too much. In fact, it's best to use a month's salary, around 1,000 USD. When I first traded cryptocurrencies, I used a few hundred dollars just for fun; I ended up losing it all. At that time, I didn't even look at the direction or the market trend, just opening positions based on my feelings, and the results were predictable.
Most beginners cannot handle the daily capital fluctuations of a 50,000 principal. Of course, you can't trade cryptocurrencies with small amounts forever. However, if you want to use larger amounts, you must have the capability. Only when you are accustomed to the daily fluctuations of your current capital and have a stable trading system, and have doubled your principal in one or two months, can you increase your capital. If you grow 1,000 USD to 2,000 USD, you can try trading with 10,000 USD. In a non-bull market, having a model strategy, it's really quick to double small amounts. If you haven’t doubled your small capital in three months, it indicates that there are problems with your trading methods and strategies that need improvement. Of course, even if your principal doubles in a short time, you still need to get accustomed to it for a while.
A fluctuation of 200 USD up and down in one day for 2,000 USD is definitely possible, equivalent to over 1,000 RMB. When the market is bad and the direction is wrong, losing a few hundred dollars in a day is very normal. If you haven't adapted to this volatility, even if you have an operational strategy, your personal emotions will greatly affect your trading; you might hesitate when it’s time to expand profits, and hesitate when it's time to cut losses, leading to liquidation.
If execution and intention do not align, making mistakes can lead to regret and strong frustration, bringing all sorts of negative emotions that distort your trading. If you're doing well and your funds start to snowball, don’t get too excited too early; an overly smooth experience is not necessarily a good thing. Overreaching can also affect your mindset, making you complacent. You won’t strictly follow your trading model, and similarly, you won’t be far from losses, so having a proper understanding and adaptation to taking profits is a challenge that all novices and veterans must overcome. Then comes the model of doubling your capital. In summary: don’t be arrogant when you make money, and don’t be discouraged when you lose. It's not shameful for novices to enter the market with a few thousand dollars instead of 30,000 to 50,000.
