1. Aim for fixed Max Profit and Controlled Max Loss
Your maximum loss should be no more than 50% of your maximum profit. For example, if you aim to make a daily profit of 10 USDT, be prepared to accept a loss of up to 5 USDT.
2. Use Isolated Margin Instead of Cross Margin
Isolated margin helps manage risk by limiting the amount you can lose on a particular trade. Unlike cross margin, where your entire account balance is at risk, isolated margin confines your potential losses to the amount allocated for that specific trade.
3. Invest Daily Profits Regularly
Like a Systematic Investment Plan (SIP), reinvest your daily profits into buying assets regularly. This strategy helps in gradually building your portfolio.
4. Keep Your Losses in Check
Ensure that your maximum loss is ideally 50% of your maximum profit. For instance, if your max profit target is 10 USDT, set your max loss limit at 5 USDT.
5. Maintain a Sufficient Portfolio Size
Your portfolio should be at least 5 times the value of your trade. If you plan to trade with 20 USDT, your total portfolio should be around 100 USDT.
6. Adjust Stop Loss When Reaching 60% of Max Profit
If your trade reaches 60% of your max profit target, set a stop loss at 50% of the max profit to secure some gains and limit potential losses.
7. Trade Value Should Be Double Your Max Profit
If you aim to make 10 USDT profit, your trade value should be 20 USDT. With a leverage of 20x, your total trade volume becomes 400 USDT.
Example Trade
- Daily Profit Goal: 10 USDT
- Trade Amount: 20 USDT with 20x leverage
- Total Trade Volume: 20 USDT x 20 = 400 USDT
- Portfolio Size: 20 USDT x 5 = 100 USDT
- Max Profit: 10 USDT
- Max Loss: 5 USDT
Calculation:
- Take Profit: Set at 2.5% of your trade volume (400 USDT). If the market moves in your favor by 1/40th, you book a profit.
- Stop Loss: Set at 1.25% of your trade volume (400 USDT). If the market moves against you by 1/80th, you incur a loss.
This gives you a 66.66% chance of making a profit.
Analyzing Market Conditions
Decide whether to go bullish or bearish based on market analysis. Spend at least 30 minutes studying the market movements of BTC and your chosen coin before trading.
Key Market Movement Times (UTC)
- 00:00 UTC
- 10:00 UTC
- 12:00 UTC
- 14:00 UTC
Important Tips
- Stick to One Trade a Day: Regardless of winning or losing, don't make another trade the same day.
- **Invest Profits Wisely**: Use your profits to invest in well-performing cryptocurrencies.
- Maintain Discipline: Stay disciplined and avoid chasing higher profits beyond your set targets.
- Do Your Own Research (DYOR): Not everyone can maintain discipline, so research and understand the market well before trading.
Also read this general article on crypto trading.
Disclaimer
This guide is based on personal trading strategies and is not financial advice. The key to success is discipline and setting realistic targets. Happy trading!