It's more important to survive the rules than to judge.
I still remember the first year I entered the cryptocurrency contract trading. My ability to judge directions was remarkably 'accurate', yet I ended up losing all 680,000 in principal. It was only late at night, reviewing the delivery orders, that I realized—I didn’t lose to the market, but fell into three fatal traps.
Trap 1: Rushing to run away, became the 'first-hand chives'.
When I first started playing contracts, I was like a child who saw candy, unable to contain myself at the slightest market movement. As soon as I saw good news or a slight breakthrough, I couldn't wait to dive in with all my capital, only to repeatedly become the 'first-hand chives' being harvested.
The most memorable time for me was when I accurately predicted the upward trend of Bitcoin. When I saw the 4-hour line showing a breakout signal, I excitedly entered the market with a heavy position. But just after placing the order, I encountered a spike pullback and was directly washed out. I could only watch as the market surged in line with my prediction, regretting my decisions.
Many beginners easily make the mistake of being led by price fluctuations. Seeing prices soar, they rush in, fearing they will miss the opportunity. This impatient mindset made me repeatedly become the market's 'contrarian indicator'—judging the direction correctly, but losing on the timing of entry.
Trap two: Stubbornly defending fixed stop-loss points becomes prey for market makers.
At first, I believed some tutorials' advice and set fixed stop-loss points of 2%-4%. But I overlooked that the volatility in the contract market is ten times that of the spot market; such small stop-loss spaces are seen as easy prey by market makers.
I was once stopped out by 'false breakdowns' twice in a row. Clearly the direction was completely correct, but I exited early because I stubbornly defended those fixed percentage points, watching the market explode afterwards.
Only later did I understand that stop-loss is not a fixed number, but a line that needs to be dynamically adjusted based on market fluctuations. Market makers are best at triggering those obvious stop-loss points and then making prices quickly return to the original trend. My mistake was treating stop-loss as a simple number game, rather than a flexible strategy based on market rhythm.
Trap three: Maxing out leverage, one pullback leads to zero.
High leverage is the sweetest poison in contract trading. Every time I am convinced that the direction is correct, I can't help but max out the leverage, thinking that this will quickly realize my dream of getting rich.
The most painful night, I leveraged 5 times and heavily invested in ETH long positions. The direction was indeed judged correctly, but just as I was fantasizing about profit, a brief pullback triggered a liquidation. Watching the account balance return to zero, I sat frozen in front of the computer all night.
Many beginners have misconceptions about leverage in contract trading, believing that the higher the leverage, the more money they make, often operating with full positions. This mindset made me forget that even the most skilled and perfect investors experience losses.
My three paths to redemption.
After reflecting on my pain, I set three iron rules for myself, and slowly crawled out of the pit of losses:
1. The position is divided into four parts, never go all in.
Now I strictly follow the principle that no single trade should exceed 10% of total funds, and I no longer put all my eggs in one basket. The core of contract trading is risk control, and 'surviving' is more important than 'making big money'.
2. Dynamic stop-loss, leave some buffer space for the market.
I no longer set fixed stop-loss points, but instead give enough buffer space based on the volatility characteristics of different cryptocurrencies. This means I accept that the market will have normal fluctuations and will not be thrown off by minor disturbances.
3. When the market is uncertain, staying out is also a strategy.
The hardest thing to learn is the wisdom of 'not doing'. When the market direction is unclear, I prefer to stay out and wait rather than rush in. Patiently waiting for opportunities that align with my trading system is the prerequisite for stable profits.
Final insights.
Over the past year and a half, thanks to these three rules, my account not only broke even but also achieved a fourfold increase. But more importantly, I understood the key to long-term profitability in contract trading.
The market is not an ATM; it's not possible to profit from every operation. Accepting losses is part of trading, and the key is to maintain a positive overall profit-loss ratio.
Now, I no longer pursue 'precise' judgments, but focus on executing my trading plan. Because I know that in this marathon of cryptocurrency contracts, those who laugh last are never the 'smart people' who occasionally make accurate judgments, but those who respect the market, adhere to rules, and can survive in the long term.
The rule is to survive; it is more important than judgment. This is the most valuable lesson I learned with 680,000 in tuition. Follow Ake to learn more first-hand news and cryptocurrency knowledge, become your guide in the crypto world, and learning is your greatest wealth!#加密市场反弹 #美联储降息 $ETH
