#数字资产市场观察 How to play Futures Trading? How can Newbies avoid the Get Liquidated trap?

Many friends who are new to the circle are asking: Can we get into Futures Trading? To be honest, many people rush in without understanding anything and end up getting a lesson from the market. Today, let's break down the topic of Futures Trading.

Let’s first talk about what a futures contract is. Simply put, you don’t need to buy coins with real money and hold them; you just need to predict which way the price will go—if you guess right, you make money; if you guess wrong, you lose money. If you think the price will rise, you open a long position; if you think it will fall, you open a short position. It all depends on price fluctuations.

There are mainly two types of futures trading in the market. Perpetual contracts have no expiration date and maintain a link through funding rates and spot prices, with both long and short parties paying each other periodically; delivery contracts, on the other hand, must be settled at the spot price upon expiration, divided into current and next season.

Understanding a few concepts in Futures Trading is essential. The number of contracts is the minimum trading unit, and the value of one contract varies for each cryptocurrency. Leverage can help you earn faster, but it can also lead to greater losses – with 10x leverage, if the price drops by 10%, you might get liquidated immediately. Opening a position means establishing a stake; if you expect the price to rise, you buy long, and if you expect it to fall, you sell short. Closing a position means shutting the order, securing profits or losses; you can place a market order for immediate execution or a limit order at a specific price. If the margin is insufficient, the system will force a liquidation to prevent your losses from exceeding your account balance.

Newbies should pay the most attention to risk control. Don't set the leverage too high; keeping it within 5 times is relatively safe—5x leverage has a much lower liquidation probability than 10x leverage. It's best not to exceed 3% of your principal for a single stop loss. For example, if you have a principal of 100,000, the maximum loss per trade should be 3,000, which means that even if you make three consecutive mistakes, you still have 91% of your capital left. When choosing cryptocurrencies, try to stick with mainstream coins like $BTC and $ETH, which have large market caps, high manipulation costs, and relatively stable trends. Smaller coins can be too volatile and lead to problems. Another key point: try to trade during the daytime; around 3 AM is a high-risk period where liquidations occur frequently and price fluctuations are erratic—newbies should avoid trading at that time.

Futures Trading can indeed yield quick profits, but to survive long-term, it relies on directional judgment, trading discipline, and risk management. Newbies should first learn how not to lose money before figuring out how to make money. It is recommended to practice on a demo account first, get familiar with it, and then use small funds for live testing. Remember one thing: do not treat Futures Trading as gambling; steady and solid progress is the key to going further.