In the highly volatile cryptocurrency market, contract trading becomes a tool for 'small bets with large returns' due to its high leverage characteristics, but it also conceals the risk of liquidation. How to dance on the edge of a knife? Here are 5 tested practical skills to help you avoid traps and achieve stable profits.





1. Strictly set stop-loss: Preserving the principal is more important than making money

In contract trading, if a single loss exceeds 5% of the principal, one should be cautious. It is recommended to adopt a 'dynamic stop-loss' strategy:

  • Trend trades: Set stop-loss 1%-2% below support levels (e.g., if Bitcoin breaks $50,000 and retraces, set stop-loss at $49,500);

  • Range trades: Use the upper and lower limits of the range as a reference, placing stop-loss 3%-5% outside the breakout point.
    Case study: A trader set a long position at $3,000 on Ethereum and placed a stop-loss at $2,940 (2% risk). Although he was stopped out, he avoided a massive loss when the price subsequently plummeted to $2,500.

2. Light position testing + pyramid scaling: The core logic of risk control

A common mistake made by beginners is to 'go all in'. The correct approach:

  • Do not open a position exceeding 5% of total capital initially; gradually increase the position after confirming the trend (e.g., add 2% position for every 5% profit);

  • Leverage ratio ≤ 5 times, high leverage (e.g., over 20 times) is only for short-term fluctuations and must be accompanied by extremely tight stop-loss.
    Data support: Statistics show that traders using 10x leverage have a survival rate 3 times higher than those using 20x leverage.

3. Go with the trend: Don't struggle against the market

'The trend is your friend' is particularly critical in the contract market. A simple way to judge the trend:

  • Daily level: Observe the direction of MA20 (20-day moving average), go long only above the line, and go short only below the line;

  • Hourly chart: Combine MACD golden cross/dead cross to confirm short-term entry points.
    Negative example: In April 2023, when Bitcoin rebounded from $28,000 to $31,000, the liquidation rate for those shorting against the trend was as high as 67%.

4. Pay attention to the funding rate: Insight into the market sentiment's 'hidden indicator'

Funding rate reflects the intensity of the contest between longs and shorts:

  • Positive funding rate (longs pay shorts): Strong bullish sentiment in the market, proceed with caution when going long, consider going short or hedging instead;

  • Negative funding rate (shorts pay longs): The market is pessimistic; wait for stabilization signals before positioning long.
    Practical skills: When the funding rate exceeds 0.1% (or falls below -0.1%) for 3 consecutive hours, it often indicates a trend reversal is imminent.

5. Emotional management: The ultimate training for traders

  • Set a daily loss limit (e.g., not exceeding 10% of the principal), and stop immediately once reached;

  • Avoid 'revenge trading': Do not blindly increase positions after consecutive losses; calmly review your strategy instead.

  • Keep a trading journal: Analyze the entry reasons and stop-loss/take-profit points for each trade, continuously optimizing the system.
    Psychologists' research: 80% of liquidations stem from emotional loss of control rather than strategy errors.





There is no 'holy grail' in contract trading, but through strict risk control, trend strategies, and emotional management, even novice traders can achieve stable profits. Remember: living long is more important than making quick money.
#合约交易 #加密货币分析