Why do some people say that trading contracts with cryptocurrencies is not advisable?
I've seen many answers, but is it true that your contracts only have options for 100x and 125x, which can easily lead to liquidation?
How large is the liquidation spike? In fact, high-leverage contracts are purely gambling. Of course, if you're playing with a few hundred dollars, it's not a big deal. But if you go all in with high leverage, that's purely a self-destructive behavior. To put it simply, contracts are meant to increase your capital utilization.
The cost of perpetual contracts is funding fees, while the cost of spot contracts is the premium. Of course, this cost can be zero or even negative. I won't elaborate on that here. Many people do not have their own trading system and have a low risk tolerance. They lack strict trading rules and prefer to hold positions. Therefore, they might think that losing 30% in spot trading is not a problem for them, while a threefold contract could wipe them out. This is completely wrong.
First of all, being able to tolerate a 30% loss indicates that you do not have strict trading discipline and are purely gambling in the market. You might claim to be a long-term investor, but long-term trading should not involve contracts because there are costs and increased risks.
If you have a strict stop-loss, being able to tolerate the loss from a wrong position is your reason for trading contracts. For example, if you have 100,000, and the current price of BTC is 100,500, you believe 100,000 is an important support level that won't break. If it breaks, you will stop-loss. The loss you can tolerate is 10,000, and you are willing to take that risk. You can consider using 20x leverage, as this keeps your losses within your tolerance. However, if you do not have a stop-loss, when it drops to 95,000, you will have been liquidated and lost everything. So do you understand? When trading contracts, you must know what your maximum loss is and ensure it is within your tolerance. Alternatively, if you aim to increase capital utilization during a known bull market where all cryptocurrencies are rising and large corrections are unlikely.
In that case, to enhance capital utilization, it is reasonable to use leverage greater than 3x to allocate to different cryptocurrencies. Personally, I believe that contracts should not exceed 2x leverage; anything beyond that is purely gambling!!
BTC has a history of 15 years, and there have only been two significant waves of increase. One wave was in 2013, when it rose from 10 to 1000, and the other was in 2017, when it rose from 300 to 19000. It is incredible that both of these increases happened within a year, specifically in the year following a halving.
You can compare this to housing prices at the end of 2017, when BTC was priced at 19000. Now BTC is just over 40000, and its increase is even less than that of housing prices.
BTC is an old friend to many, but it is also something new, as people's understanding gradually improves. Just like when the internet first emerged, many called it an internet scam or a bubble. Most people only thought about investing when they found themselves surrounded by the internet and realized they couldn't live without it; by then, stock prices had already skyrocketed, like Apple's 3 trillion market value.
How many users does BTC have? Less than 50 million, which is negligible compared to Apple's billions of users. However, these fewer than 50 million users have created nearly a trillion in market value, which precisely indicates that there is still tenfold or hundredfold potential for growth in the future.
So entering the cryptocurrency world is never too late, as long as you are earlier than your neighbor.
Suddenly surging past 110,000, the cryptocurrency world has exploded! Now the screen is filled with fervent emotions; some people are already imagining a handshake between China and the U.S. after Trump takes office, with trade doors wide open, as if a bull market perpetual motion machine has been activated.
But don’t just daydream. This place in the cryptocurrency world has always been a real battle of wits. Recently, there was a fierce showdown between Liangxi and James; one was stubbornly shorting, while the other aggressively went long. In the end, the bears were defeated, but will the market really follow someone’s lead?
At this critical juncture on the 13th, who dares to guarantee there won't be any surprises? Remember, regardless of up or down, the market maker's scythe is always hanging overhead.
📉 Today's Market Analysis | The Market is Delicate, Respond with Caution!
Today's market movement is quite interesting, with a continuous decline during the day. After the CPI data was released, there was a brief surge, but after the US stock market opened, it peaked and then fell back, returning to a downward trend.
🔍 Key Observation Points: 1️⃣ Is the rebound trustworthy? It currently seems more like a false breakout; pay attention to the 107000 support level on the 4-hour chart. 2️⃣ Trading volume is shrinking, prices are rising but buying pressure is insufficient; beware of the risk of a trap! 3️⃣ The MA30 moving average is flat; if it continues to close bearishly, the MACD may form a death cross, and the double top structure may be confirmed. 4️⃣ Greed Index at 78; historical highs are often accompanied by market shifts, so be cautious of the risk of a pullback.
💡 Operational Advice: Exercise caution in the short term; if it breaks below 105000, the trend may turn bearish; however, if the pullback is in place, there may be an opportunity to position.
🤔 Are you trapped? Or are you preparing to buy the dip? Feel free to leave a comment with 168 in the comment section, and let's discuss market trends together!
Remember this logic, and the next Cullinan might just be parked downstairs from your home.
1. Understand stop-loss and take-profit. Trading cryptocurrencies is to make profits, not to hold indefinitely. When your position moves in the wrong direction, sell decisively to avoid unnecessary losses. Do not be greedy when making money in the crypto world, and do not hesitate when facing losses. 2. Do not pursue absolute highs and lows. The market always has lower lows and higher highs, which are difficult for ordinary people to grasp accurately. We just need to buy in the bottom area and sell in the top area to catch the big trend. 3. Volume and price must match perfectly. Rising with low volume or achieving new highs with low volume often signals that the main force is unloading or that the rise is exhausted. It’s better to miss out than to chase, to avoid becoming the one left holding the bag.
The fundamental reason for forced liquidation of contracts is that market price changes exceed users' expectations and risk tolerance, resulting in insufficient margin to support the contract position. Inches. Due to the leverage effect, the risk of contract trading is very high. When the price is unfavorable to you, you need to close your position in time to prevent further losses. Large. If you do not close your position in time, your margin will gradually decrease until it eventually reaches the liquidation line. If your margin falls below the... If the position is calculated, your position will be forcibly liquidated, and all funds will be settled. Specifically, there are several common situations:
Contract Explosion Prevention Guide ● Risk Management. Contract trading is a high-risk investment activity. Before engaging in contract trading, you need to develop a detailed risk control plan. Capital Management. Proper capital management/allocation can effectively reduce risks and avoid contract liquidation. Control Leverage Ratio. Controlling the leverage ratio is one of the important methods to avoid contract liquidation. Timely Stop Loss. Stopping loss is harder than taking profit.
From self-awareness to strategy refinement, achieving a long-term stable path The famous investment philosopher Van Tharp once said: "What you trade is not merely the market, but your understanding and beliefs about the market." This refers to your investment operating system - a unique set of market interpretations and action guidelines you possess. But building such a practical system is easier said than done. Before constructing a recent strategy system, you need to clarify your investment philosophy and gain a deep understanding of yourself. This includes your interests, goals, knowledge accumulation, skill mastery, and the boundaries of your abilities. Only by truly understanding yourself can you find the path that suits you. Additionally, you need to be clear about when to enter and exit the market, which targets to choose, and how to allocate positions. Furthermore, you need to be prepared to deal with mistakes. When the market trend does not conform to your expectations, how should you respond? This does not mean you should choose extreme measures, but rather learn to draw lessons from failures and continually refine your system. You may find this path challenging. However, playing with cryptocurrencies is not an easy task that can be accomplished overnight; it requires continuous learning, practice, reflection, and adjustment. Establishing and validating a complete investment operating system often requires enduring the trials of two bull and bear cycles. In the stock market, this may take 6 to 10 years; while in the cryptocurrency space, although the recognized bull and bear cycles are shorter, about 4 years, it still means you need at least 8 years to continuously refine and validate your system. This may sound daunting, but you should know that this is a marathon, not a sprint. However, I must also admit that not everyone realizes the importance of establishing an investment operating system. Some retail investors may spend their entire lives blindly following trends, chasing highs and selling lows, without ever truly building their own strategy system.
How to establish a robust contract trading system to cope with market volatility?
Why are many people still hesitant and reluctant to buy recently? After in-depth analysis, I found that different individuals have their own unique insights, but more voices reveal the following mindsets: First, "out of ammunition", lack of funds makes them unable to re-enter the market. Second, doubts about "endless decline", fearing the market will continue to drop after buying. Third, the mindset of "fear of loss and desire for gain", afraid of losses while wanting to pursue victory, thus falling into the trap of chasing highs and cutting losses. Fourth, "waiting and watching", missing good opportunities in hesitation. Fifth, "lack of courage and determination", feeling fear of the unknown in the market, unable to take decisive action. These mindsets are common in the cryptocurrency space, acting as an invisible barrier that fills the market with panic. After in-depth analysis, I found that the first four reasons mostly stem from a lack of understanding of contract investment. Only when you have an in-depth understanding and sufficient awareness of the market can you overcome these obstacles and have the courage and determination to cope with market fluctuations. The two main reasons for the market's slump after a significant drop in cryptocurrency: first, the inherent fear instinct of humans, and second, insufficient understanding of contract speculation. Apart from these psychological factors, I believe it is even more crucial to establish a personal contract trading system.
In fact, I have tried to build multiple operating systems. I have meticulously designed valuation models for cryptocurrencies, criteria for buying and selling, strategies for filtering cryptocurrencies, and plans for holding periods. Whether in the stock market or the foreign exchange market, I have invested my efforts into operations. Now, I bring these experiences to the cryptocurrency space, hoping to find my own path to success here.
In the past six months, I encountered five liquidations in contract operations. This was undoubtedly a heavy blow for me and a miraculous experience in my cryptocurrency career. After each liquidation, I tried to find various reasons and explanations, just like many retail investors, complaining about the market's volatility.
But one day, I suddenly realized as if enlightenment struck me. I began to realize that an overly complex operating system may not be what I truly need. I started to think about whether there is one strategy that could help me break free from the troubles of liquidation and allow me to navigate the cryptocurrency space more calmly.
Thus, I found my answer - stringent position management. Although this approach is simple, it contains profound investment wisdom. It allows me to remain calm in the face of market fluctuations and avoid falling into difficulties due to excessive leverage or heavy positions. I believe that as long as I can strictly implement this strategy, I will be able to go further and more steadily on the road of investment.
Why Simpler Trading Techniques Can Earn More Money
Using the simplest trading system can actually earn money. How simple can a trading system be? Open a position with one point, use one K for stop loss, and when it breaks this K and leaves, isn't it very simple? So simple that you dare not believe it. But I tell you, this is a so-called positive system with a huge profit-loss ratio. The real simplicity is the simplification after experiencing complexity, and when you haven't even experienced complexity yet and say it's simple, that's not true. Simplicity is defined by your most perceived understanding, which may appear as ignorance in the eyes of others. We gradually correct these underlying issues; everything simple must be based on logical thinking that extends to the results of actions. This is a process, and you will find they are all logic-based. Everything must start from logic, but the foundation of generating logic is cognition. The closer your understanding of something is to its essence, the more naturally your logic will change with your understanding, gradually transforming into cognitive logic, thinking, philosophy, and methods. Every book you see is actually such a process. This process needs to be experienced; it cannot be just talk, nor can it be just theoretical discussions. The market is dynamic; in the movement of the market, some people continuously come in while others continuously go out. Only through the fermentation of time can the power of funds form a collective force. This collective force will drive the market in one direction, and this process can be interrupted at any time, just like a W bottom turning downward, suddenly becoming an ending. Of course, this is just a small example, but it illustrates that it is very difficult to achieve sustained and stable profits using any theory. You may also believe that all theories are truly just to sell you a book. However, if you really take the time to watch the market, you will also discover some key levels in the market. They belong to different cyclical forces, and you need to clearly understand the level of their reactions and whether you should participate. Such cyclical forces will impact your trading cycle; do you need to place trades? Does this trade align with your underlying logic? What is the price difference, how much is the loss, and how much is the profit? You also need to consider the time factor and the facing conditions. When the market further moves to prove you are correct, you then need to consider what the market is doing and how you should handle your trades. The entire trading process is essentially a psychological process, but in terms of behavioral performance, you only have actions like opening a position, stopping loss, or not opening a position at all. These are the only actions, which are then reflected in the market's K, waiting to open a position, waiting to close a position, with nothing else. Returning to simplicity, performance is just an opening position at one point and a stop loss at one K. However, have you truly understood the market, and have you truly understood yourself, trying to integrate yourself with the market as a whole? When you reach this point, you will naturally know that all theories are actually one, and all theories have their merit. Similarly, this point of opening a position can exist at various levels such as weekly, daily, hourly, and even minute-second levels!
If you are determined to trade cryptocurrencies for a lifetime and hope to one day support your family through trading!
Then, please remember the following 10 iron rules. The content is not much, but every sentence is valuable. Share it with those who are destined to receive it! If a strong coin drops continuously for 9 days after a high position, make sure to follow up in a timely manner.
2. If any coin rises for two consecutive days, make sure to reduce your position in a timely manner. If any coin rises more than 7%, there is still a chance for further increase the next day; you can continue to observe. For strong bull coins, wait until the correction ends before entering the market. If any coin fluctuates calmly for three consecutive days, observe for another three days; if there is no change, consider switching to another coin. If any coin fails to recover the previous day's cost price the next day, you should exit in a timely manner. In the ranking of price increases, if there are three, there will be five; if there are five, there will be seven. For coins that have risen continuously for two days, buy on dips; the fifth day is usually a good selling point. 8. Volume-price indicators are crucial; trading volume is considered the soul of the cryptocurrency market. When the price breaks out at a low level during consolidation, it needs attention; when there is a volume stagnation at a high level, be decisive in exiting. 9. Only choose coins that are in an upward trend for trading; this maximizes your chances and won't waste your time. When the 3-day moving average turns upwards, it indicates a short-term rise; when the 30-day moving average turns upwards, it indicates a medium-term rise; when the 80-day moving average turns upwards, it indicates a major upward trend; when the 120-day moving average turns upwards, it indicates a long-term rise. 10. In the cryptocurrency circle, small funds do not mean no opportunities. As long as you master the correct methods, maintain a rational mindset, strictly execute strategies, and patiently wait for opportunities to arise. My trading method is very simple and practical. I reached an 8-digit figure in just one year by entering the market only when I saw the right opportunity, avoiding trades without clear patterns, and maintaining a winning rate of over 90% for five years! #交易认知
From Debt to Freedom: The Ultimate MACD Practical Rules for Professional Traders A trading system earned through blood and tears, helping you feast in a bull market and survive in a bear market! My story: From a 2 million liquidation to financial freedom In 2019, I leveraged my entire position on altcoins, and as a result, ETH's sharp drop liquidated my position, turning 2 million into 90,000, and I almost ended it all. On March 12, 2020, Bitcoin crashed by 50%. Everyone was panicking, but I discovered "MACD histogram bottom divergence + daily zero axis death cross" = a crash signal! So I went short with 20x leverage, turned it into 23 times in 3 days, not only covering my debts but also buying a luxury car. Before LUNA went to zero in 2022, MACD warned again: 4-hour top divergence triple play, I went all-in short and made 8 figures in a week. Conclusion: Bull market warriors are everywhere, but only those who survive the bear market are the true masters! Practical strategies: Double in a bull market, survive in a bear market Bull market offensive strategy 1. Golden cross above zero axis + breakout with volume → Go all in! 2. Histogram continuously increasing + price running along the upper Bollinger band → Hold until death cross appears! Bear market defensive strategy 1. Death cross below zero axis + volume breaks support → Go short! 2. Histogram decreasing rebound + price fails to break EMA30 → Short on rallies! Extreme market survival techniques Black Swan warning: MACD 4-hour top divergence + large transfers from exchanges → Immediately reduce positions! Spike market: 1-minute MACD rapid death cross + explosion in liquidation volume → Stop trading! Ultimate advice for professional traders 1. Don’t blindly trust any indicator, but MACD is the hardest for market makers to fake! 2. Make more in a bull market, lose less in a bear market; surviving is winning! 3. Always set stop losses; one liquidation = end of your career! Tonight's focus: BTC $110,000 key battle, if MACD shows "decreasing histogram + top divergence" = major correction signal! If ETH falls below 2700, MACD death cross confirmed = short entry opportunity! There's a saying on Wall Street: Make money in a bull market, gain experience in a bear market, learn lessons in a sideways market. If you really want to survive long-term in the crypto space, relying solely on technicals is far from enough. What you need is a system, discipline, and counter-intuitive training! Follow me! Are you ready!!
After Bitcoin stabilized above 105 yesterday afternoon, it began to gradually rise, reaching 1106500 this morning, just 1500 points away from the previous high, which is a matter of a needle's point. It subsequently pulled back and is currently above 109, having retraced 1500 points and is still oscillating. From 4:30 PM yesterday to 5:30 AM today, Bitcoin surged for 13 consecutive hours, breaking through the 110,000 mark again. It seems that good news is coming one after another. Let's summarize: 1. Continuing last Friday's rebound in U.S. stocks, all three major indices have rebounded to new highs since the trade war. 2. The relationships between these two major crypto supporters have eased.
2025 Cryptocurrency Environment Forecast is Here!!!
1. Market cycles and Bitcoin halving - Bitcoin halving in 2024: In April 2024, Bitcoin will undergo its fourth halving (from 6.25 BTC to 3.125 BTC). Historical experience suggests that a bull market may follow within 1-2 years after halving, and 2025 may be in the mid or late stages of a bull market. Cycle patterns: If the market follows historical patterns, 2025 may see liquidity easing (such as interest rate cuts by the Federal Reserve) and institutional capital entering, driving price increases, but there are risks of cycle delays or failures. 2. Regulatory and compliance process Clear policies from mainstream countries: Economies like the US, EU, and Japan may introduce clearer regulatory frameworks for crypto assets (such as comprehensive approval of spot ETFs and legislation on stablecoins), and compliance will attract traditional capital.
Is it still possible to enter the cryptocurrency market now?
Cryptocurrency market in 2025: Can we still enter? How to seize the next round of opportunities and risks. The cryptocurrency market undergoes a bull-bear cycle every four years (usually related to Bitcoin halving events), and 2025 may be at a critical stage of a new cycle. Despite the uncertainty in the market, by combining technological developments, regulatory trends, and industry innovations, we can still identify potential opportunities and strategies. #BTC
Not calming down, a restless mindset can lead to frequent portfolio changes. I know a friend whose plan was to turn 200,000 into 80 million. When I got to know him, he had already played a round in 2017. In 2019, after buying coins, he deleted the app. In 2021, when he opened the app again, it had already increased by more than ten times. He sold immediately and exchanged it for USDT. He deleted the app again, and in March 2023, he downloaded the app, bought coins with USDT, and deleted the app again. He plans to sell the coins in 2025 when he opens the app again. What I know is that he has multiplied his principal by almost 200 times using this method. Earning money in a big trend is not difficult, but if you act frequently, it becomes very hard. I also have a friend who bought three coins in 2021, then deleted the app, and when he re-downloaded it in 2024, he found that most exchanges had exited, rendering them almost worthless. #我的COS交易
Musk and Trump spent the whole day insulting each other. What did they say?
Trump's 'economic nationalism' is irreconcilable with Musk's global business landscape, so parting ways is inevitable. However, the current conflict may be a 'double act,' with Musk publicly criticizing to shift public pressure while retaining his position as a senior advisor; Trump, on the other hand, uses this to appease the hawks within his party and pave the way for the midterm elections. This 'decent breakup' can maintain a façade of opposition while continuing cooperation in key areas. Back to the main topic, let's first discuss what the two of them have been ranting about all day: (1) Trump: First, the accusation of betrayal against Musk Trump stated on the 'Truth Social' platform that Musk 'knew months ago' that the government would revoke the electric vehicle 'mandate,' but only opposed it after the provision was canceled, calling it 'betrayal of allies for personal gain.' He emphasized that Musk previously supported the overall framework of the 'big and beautiful' tax reform bill but changed his position only after realizing his own interests were harmed. Next, the threat to terminate government subsidies and contracts Trump explicitly stated through social media that he would terminate Tesla and SpaceX's government subsidies and contracts 'in the simplest way' by cutting budgets. Specific measures include: Revoking the nomination of Musk's ally Isaacman as NASA director; threatening to terminate SpaceX's NASA launch contract worth billions of dollars; considering cutting Tesla's federal electric vehicle subsidy (up to $7,500 per vehicle). Then, Trump questioned Musk's political influence.
The conflict between two powerful figures in the world is intensifying, but signs of a ceasefire are emerging. After a day of arguing with Elon Musk on social media, President Donald Trump showed a nonchalant attitude during an interview with POLITICO on Thursday. According to the latest POLITICO report, White House aides are working to persuade the president to tone down his public criticism of Musk to avoid escalation, and plan to have a call with the Tesla billionaire CEO on Friday to facilitate peace. "Oh, it's fine," Trump said during a brief phone interview with POLITICO when asked about the public split with his once super supporter, "Things are going very smoothly, never been smoother." This stands in stark contrast to the fierce online battle between Trump and Musk over his 'beautiful legislation.' The bill is currently under consideration in the Senate and covers a range of agenda items from President Trump’s tax cuts to immigration enforcement. With high stakes, the clashes between the two sides are unusually intense, with aides and allies including hedge fund manager Bill Ackman rushing to ease tensions, and Musk seemingly agreeing. $BTC
What caused the fallout between Trump and Musk? The fallout between Trump and Musk mainly stems from intense disagreements over the "Big and Beautiful" tax reform bill, which eliminates the electric vehicle tax credit policy impacting Tesla's interests. Musk criticized Trump for not informing him in advance, to which Trump retaliated against Musk. Additionally, there were controversies over NASA personnel nominations, long-term policy disagreements such as tariffs, contradictions with the Department of Efficiency, debt issues, as well as personal grievances and power struggles. Musk accused Trump of being ungrateful and revealed his involvement in the Epstein case, while Trump accused Musk of being crazy and threatened impeachment against himself. $BTC