Why do so many people still play when contracts keep getting liquidated?

1. Fund management must be up to standard. With leverage ranging from 0-100x, short-term losses are inevitable. The risk per trade generally should not exceed 2%-3%, while aggressive traders can go for 5%-8%. Risks exceeding 8%-10% may lead to a drawdown of 70% during unfavorable periods, and the average person's psychological breaking point is around 50%. Strictly enforcing fund management is essential. Many people prefer to trade with 5x or 10x leverage, operating on levels above 4 hours, where stop-loss levels are usually between 5%-15%. This means the risk per trade has already reached 25%, and doing so is akin to courting disaster. To ensure risk levels, it is necessary to lower the trading timeframes to 1 hour, 15 minutes, or 5 minutes. The smaller the timeframe, the fewer traders can manage it; generally, most players can handle 1h-4h, while professional traders might manage 5-15 minutes, and even they struggle with 1-minute levels.

2. The trading system must be sound. Refining the trading system requires long-term trading experience accumulation. A successful sign of this is not deviating from established patterns and having clear conditions. During this process, continuous iteration is necessary, going through the baptism of mainstream trends during bull and bear markets. Since this is leveraged trading with T+0 and frequent trades, one should be prepared to pay 90%x9 in tuition. Many people jump in with hundreds of thousands, but they must understand one thing: regardless of the initial capital, it only covers one tuition payment, with 8 more to follow. Therefore, it is essential to start with small amounts; trading with a few hundred or a few thousand is acceptable, and one should not increase capital just because of profits. Instead, withdraw profits and continue trading with small amounts. In the beginning, the system and operations will not be particularly refined, and many mistakes and unnecessary actions cannot be avoided.

3. Execution must be on point. Similar to last year's May 19 incident, a single misstep can lead to irrecoverable losses. Any profits made beforehand become meaningless if similar black swan events occur. Strict stop-losses are fundamental, and most liquidations occur from counter-trend bottom fishing, like the recent Luna case, which also resulted in liquidation from counter-trend positions. Avoid gambling on low-probability events, and do not expect to achieve everything in one go.

4. Time and experience accumulation. In a bull-bear oscillating market, one needs to familiarize themselves with the characteristics of different phases and adjust strategies accordingly. For small retail traders, time spent in this market is inherently limited, making it challenging to engage in such a specialized field.