Ninety percent of contract traders fail due to 'improper rolling positions', after blowing up they curse 'contracts are a scam', yet fail to realize that true profits lie within the scientific logic of rolling positions. The iron rules of rolling positions distilled from 3 years of practical experience are revealed today—those who comprehend are profiting from the trend, while those who do not understand are still relying on luck to lose money.
The essence of rolling positions: allowing profits to autonomously 'multiply', rather than letting risks 'breed'.
Pseudo rolling position: blindly increasing positions when there are floating profits, using leverage as a gambling tool, a single pullback can lead to 'compounding to zero'.
True rolling positions: build a compounding system based on trend logic combined with position discipline, ensuring every position increase is grounded in 'certainty'.
The 3 major survival principles that must be strictly adhered to in rolling positions.
Do not increase positions when the trend is unclear.
Signal standards:
Break through key resistance levels (such as previous highs on the daily chart) + surge in trading volume;
◦ Confirm trend continuation if support levels (such as moving averages, Fibonacci levels) are not broken.
・Counterexample: frequently increasing positions in a volatile market, getting 'slapped in the face' by the main force and blowing up.
Each position increase is an independent decision.
・Position management:
The first position should not exceed 5% of total capital, with a leverage of 5-10 times (leave room for volatility);
◦ After confirming the trend, increase position by 3% each time a key level is broken (e.g., add when ETH breaks $2500), it is strictly forbidden to go all in at once.
Stop loss follows profits 'climbing stairs', locking in profit bottom lines.
・Dynamic stop loss method:
The initial stop loss should be set at 3%-5% of the entry price;
Each time a position is increased, raise the stop loss to the cost price of the previous increase (e.g., first position at 1000 goes long, stop loss at 950; break through 1100 to increase position, raise stop loss to 1000).
Comparison of incorrect vs correct operations: 5% position determines survival.
Incorrect demonstration (gambler's mindset) Correct posture (trend mindset)
If it rises by 5%, directly go all in and chase with 10 times leverage. Start with a 5% position for trial and increase by 3% upon breaking key levels (such as MA60).
No stop loss set, fantasizing 'continuing upward after a pullback'. Stop loss follows to the cost price, exit upon a drop (protect principal).
If profits reach 50% and are not cashed out, a market reversal could lead to losses. Reduce positions stepwise every 20% increase (e.g., first take profit at 30%).
Seize the golden opportunity of the main upward wave: 3 'confirmation signals' during trend acceleration.
K-line pattern: long bullish candle breaking previous consolidation range, with an entity length over double that of the previous day;
Trading volume: expanded by 1.5 times compared to the average of the previous three days, with funds eagerly entering the market;
Market sentiment: sudden increase in contract open interest, spot premium rate rises (e.g., BTC premium rate > 3%).
Key operational points: base positions with 3-5 times leverage, during acceleration phases use floating positions (2-3%) to scale in, gradually take profit after capturing 80% of the main upward wave.
The ultimate solution to prevent profit withdrawal: two-step locking profit method.
Profit protection stop loss:
◦ When profits reach 20%, move the stop loss to break-even (ensure no loss);
◦ When profits reach 50%, move the stop loss to cost price + 30% (lock in basic profits).
Stepwise position reduction:
Each time a new high is set, take profits on 20% of the position;
◦ Clear out remaining positions when breaking below short-term moving averages (such as 4-hour MA10).
Real case: During the main upward wave of ETH from $2000 to $4800 in 2021, a trader used '5% base position + 3% stepwise increase + dynamic stop loss', rolling a $50,000 principal to $5 million, with a maximum drawdown controlled within 15%.
Final warning:
Rolling positions are not a 'sure-win method', but a tool to combat human weaknesses through discipline. The more chaotic the market, the more these 3 bottom lines must be adhered to:
✅ Do not guess tops and bottoms, only increase positions after confirming the trend;
✅ Always leave room for positions, eliminate the 'all in mentality';
✅ Take profit when enough is made, do not be greedy for the last 10% of the tail market.
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