Four rules
1. Determine the total warehouse: For example, the funds of an account used to play contracts are always 300U. The maximum loss is 300U. If there is a big market trend, the profit will be tens of thousands of U.
2. The starting lot is determined: the starting lot is always a very low amount. The principle is what stock expert Liver Moore said: If you are right, it is best to make money from the beginning, so the amount you start with to test the waters is very small. 300U full position, usually 2U or something like that will do.
3. Confirmation of adding a position: When adding a position, you must use profits to add a position. When profits appear and the trend appears, you will only consider adding a position.
4. Stop loss position: Adjust the stop loss position in time to ensure no loss of principal.
These four rules have made me strictly abide by the trading rules, so the logic behind them can also be used on ordinary low-multiple contracts. The reason is the same. Of course, before starting, I still have to make a risk warning:
Newbies should not play with contracts, especially those who think there is some contract technique or some contract master who can predict the price, and as long as they listen to him, they can make a lot of money.
Don't touch it. Anyway, I don't have the ability to give you a tip to make you rich. And contracts are very challenging to human nature, unless you can insist on using only a very small amount of money, such as 100U, 300U, etc., so that it is in line with "small bets for big wins" instead of "big bets for small wins". I am talking about the method, hoping to give some reference to contract players, that's all.
Key tips:
1. Transferring funds
Transfer USDT to the exchange, with a total of 300U as the upper limit. How much is 300U? For me personally, for example, I use 100,000U per share in spot trading for large positions, and 5,000U for small positions. I use 300U to play 100x. You can look at this ratio yourself. Generally speaking, you can also use 1% of the total funds as a principle, but not more than 300U per transaction. Here is an additional sentence. In fact, I don’t recommend 100x contracts. The risk is too high and the cost performance is low. Either it is less than 5X, a large position is dead, or it is 50-100X, a very small position to fight for a big profit-it is best to only take the latter, because the contract will inevitably explode, and the low multiple is the same. If it is 100x, either 300U will explode or make a huge profit. In general, the profit and loss ratio is extremely large.
2. Starting Skills
Assuming that BTC is currently at 16500U and has been fluctuating for a long time, I am still bearish and expect a big market trend. I suggest starting with 10U and 100X.
After opening a market, don’t worry about the decline unless your position is liquidated. Just stand still and watch the show, stay calm - this is equivalent to choosing a direction before you open a market. You’d better be more than 70% sure of this choice in the short term, and it would be best if you expect a big market trend to appear.
The big market usually appears after the K-line goes flat, as shown in the following figure:
Market situation after 312
As shown in the above figure, in the market after 312, in each shock, after the K-line becomes flat, there will eventually be a big upward or downward market. It will be more helpful to find an opportunity to intervene at this time. As for how to find opportunities, you can refer to some tutorials and observe the appearance of specific K-line patterns, such as 2B structure, etc. In many cases, when opening a position, you feel that the current position is not ideal for various reasons, so you can reduce the starting position, such as 1U. On the contrary, if you are particularly sure of a certain position, you can slightly increase it.
But you have to convert it. If you use 10U to open 100X, the total position is 1000U, and your principal is 300U, which is equivalent to more than 3 times. The risk is relatively high and is not recommended! Because the key to our starting position is to survive the shock, don't be greedy!
3. Tips for adding positions
For example, if the market does fall below 16,000, and there is a huge negative news, and you combine the trading volume, MACD and other observations and think that there is a great chance of a big drop, then you should consider adding positions, and use profits to add positions. In fact, this is commonly known as rolling positions, which is almost the key to small funds making small bets for big gains, but at the same time, rolling positions is
This is a technical job, and most people get blown up here. Here is the method: At this time, the market is falling, my order has made a profit, 300U has become 400U (for example, I didn't calculate the specific amount), then before I increase my position, I observe that my profit has reached 100U, so I suggest setting a stop loss after increasing my position, and the stop loss means a loss of 100U, and finally there is still 300U of principal.
Because we have already made money, and the direction is likely to be right, there is no reason to risk the principal. At this time, you should note that if you set a stop loss of 100U, it actually means that your original position was 300U of principal, and now it is 100U of profit. If you increase your position, you may be stopped at any time.
Because, at this time you can actually proceed in steps. The first step is to set a stop loss of 100U. Don't rush to add it. Wait until the profit expands and then add a little bit at a time. It is best to stop the volatility as much as possible.
The secret here is not to be greedy. If you are not sure, don't even add. A 100x contract is really profitable, and the same is true for losses. There is also a timing issue to pay special attention to when adding positions. It is best to add positions when waiting for a small rebound during a decline, or a small pullback during an increase. In this case, the 2B structure is particularly useful and worth learning.
It is best to add positions only two or three times, and then watch the market run - the more you add, the more dangerous it is during a pullback.
4. Other supplements
Short-term high multipliers are the correct way to play contracts, high risk but higher returns - please note, I have to emphasize again, I am not asking you to play with high multipliers, especially novices, don’t even touch it because you don’t understand it, I am just sharing my thoughts and methods.
1. To form your own system
In trading systems, there is no holy grail.
We can see that short-term masters like Ram Williams and CIS have very good long-term actual combat records. The former's books have also sold a lot, but I have not seen a second Williams, because everyone's mentality and system change slightly, and the trading results are very different. Therefore, if you want to wear the crown, you must bear its weight. Form a trading system of your own, enjoy its benefits, accept its shortcomings, constantly summarize the market rules, and constantly repair it to succeed.
2. Understand the profit and loss ratio
In the trading system, the profit-loss ratio is the most important content. The real profit formula is: profit-loss-handling fee>0. There are three basic modes in trading. The first two are:
One is high profit-loss ratio + low winning rate + low frequency. Trend tracking, medium and long term. For example, a fat otaku Bitcoin with a principal of 100,000 yuan achieved a small goal in the 2021 bull market, which is actually a trend trader.
The second is low profit-loss ratio + high winning rate + high frequency. In the short-term expert mode, the profit-loss ratio is often 1:1, which is very bad. Only some legendary figures can do it. I don’t think I can do it. There is another type of people in this industry who seem to be quantitative high-frequency traders who eat the exchange fee spread. They are relatively high-end and generally don’t teach others. Each exchange will ban this type of person once they find one. Ordinary users don’t need to understand it.
The third is the terrifying profit-loss ratio + medium winning rate + extremely low frequency. The thousand times I talked about is my own classification, called the third category, which is also a unique benefit in the cryptocurrency circle:
For a 300U order, the maximum loss I can accept is 300U. I can open an order many times according to my method of opening an order above, but as long as I win any time, my profit and loss ratio will be terrible. For example, the 46U order has been up to 25,000U. If the website does not cause trouble, it can reach 50,000U, which is nearly 1,000 times. With this kind of profit and loss, plus I only open orders at key positions, it doesn’t matter if the winning rate is below 10% - do you think it’s easy to get a winning rate below 10%? It’s impossible to have a winning rate of only 10% even with your eyes closed.
Big data shows that the winning rate of retail investors is around 33%.
In fact, from the perspective of comprehensive strategy and tactics, a system with a high win rate and low profit and loss ratio, a system with a low win rate and high profit and loss ratio, and my system can all be successful. Therefore, there is no need to dogmatically believe that there is only one way, a low win rate and a high profit and loss ratio. The profit and loss ratio must be above 3:1. A 10% win rate or a 90% win rate can create a successful trading system.
Since both high and low winning rates can be successful, there is no need to worry about whether to do long-term or short-term trading. You can even mix the two. What is important is to find a trading method that suits you when the strategies and tactics of the transaction are well matched.
