Leverage on Binance allows you to increase your purchasing power in trading using borrowed money, which increases your chances of making higher profits. But you should understand that the risk also increases, and may lead to greater losses. Here’s how to make profits with leverage on Binance:
1. Understanding the concept of leverage
Leverage multiplies the size of your trades.
Example: If you choose 10x leverage and you trade with $100, your buying power becomes $1,000.
Leverage Effect: Profits or losses are calculated based on the total value ($1,000 in the example).
2. Choosing the right market
Choose highly liquid markets like BTC/USDT or ETH/USDT.
Monitor market movements and analyze trends before entering.
3. Trade wisely
Profit making strategies:
1. Trend Trading:
If you expect the price to rise, open a long position.
If you expect the price to fall, open a short position.
2. Day trading:
Take advantage of short-term market movements.
Set a clear profit target and stop loss level.
3. Trading based on news:
Follow market news and global events affecting cryptocurrencies.
4. Risk Management
Use Stop Loss to avoid large losses.
Do not use all of your credit in one transaction.
Try low leverages (2x - 5x) if you are a beginner.
5. Market Analysis
Use technical analysis tools such as:
Moving Averages
Relative Strength Index (RSI)
Japanese candles
Combine technical analysis and news analysis to make informed decisions.
6. Start with small amounts
Practice with small amounts until you master the use of leverage.
Use a demo account if you are new to trading.
7. Follow up on fees and financing
Leveraged trading fees are higher than regular trading.
Check the Funding Rate especially if you hold your trade for a long time.
Important warning
Trading with leverage carries a high level of risk.
Don't risk money you can't afford to lose.
Don't rely on luck alone, rely on analysis and planning.
