Do not act unless the key position is reached, do not act if the plan is unclear, do not act if the stop-loss is not decisive.
When many people hear that I do contract trading, their first reaction is 'Oh, it's just gambling on high or low.' Today, I want to break this misconception and tell you why those who truly understand the field never treat contracts as gambling tools.
Those who dare to leverage three times their capital with a ten thousand yuan principal and casually say 'It's just five times' have no idea what risk is. This is not trading; it's roulette with a calculator.
The essence of contracts is hedging, not gambling
In the eyes of many, contract trading is just about guessing price movements, but its core value is actually risk hedging and hedging against losses. It's like buying insurance for your assets, reducing losses when the market is unfavorable.
When I hold spot positions and worry about declines, I short equivalent positions in the contract market, so that regardless of how the market moves, my losses are controlled within acceptable limits. This is not about 'gambling on size,' but rather risk management based on calculations.
Major global regulatory bodies, such as the EU MiCA framework and the US CFTC, regard perpetual contracts as financial derivatives rather than gambling activities. Platforms identified as gambling often do so because they bet against users, manipulate prices, or decouple results from actual fluctuations.
The patience of a hunter: waiting is key
My team and I spend most of our time waiting. Waiting for key positions to appear, waiting for extreme market sentiment, waiting for high-probability entry signals.
This is not idleness; it is an important part of trading, just like a hunter observes the weather and the habits of prey. I remain calm when the market is panicking, and I know when to pull back when the market is euphoric. This 'counter-emotion' operation is the key to stable profits.
Every action must come with a plan: our code of conduct
Do not act until the key position appears; this is our first principle. And once we act, there must be a clear plan:
Stop-loss is never hesitated. If a single loss exceeds 5%, I exit immediately without explanation or fantasy. This is not cowardice, but a survival rule.
When profitable, let profits run. The take-profit line should be at least twice the stop-loss, using small losses to seek large gains.
Position control is key. I never use excessive leverage; the amount added each time decreases, and the total position does not exceed 5% of total capital.
Based on calculations rather than feelings
Some say contract trading is 'guessing size,' but the difference is: guessers rely on feelings, while we rely on calculations.
Behind each trade is volatility review, position ratio calculation, and risk exposure time assessment. Your 'feeling' may be a trap that others have long set. If you're still placing orders based on 'intuition,' it’s better to turn off the software and take a break.
Every price movement in the market is not purely a random event, but driven by multiple factors such as macroeconomics, supply and demand, technological development, and geopolitics. Through in-depth research and risk management, contract trading can be a form of investment rather than mere gambling.
Contract trading itself is just a tool; the key lies in the person using the tool. Treating it as a gambling device will ultimately lead to total loss; viewing it as a risk management tool is essential for long-term survival in this market.
Knowing when not to act is more important than knowing when to act. Follow Xiang Ge for more firsthand information and cryptocurrency knowledge on precise points, becoming your guide in the crypto space; learning is your greatest wealth!#巨鲸动向 #加密市场观察 $ETH
