What a mistake your friend did.
He shouldn't do leverage when he's not going to monitor it. That is why when I'm always doing stuff and not leaving my trades, I keep track on it wherever I go.
And putting all of your networth on a single trade is a crazy thing. I'd always do the trades that it's not going to cost me that much so I am safe.
While the entire networth of me is on a safe place where I wouldn't touch it for so long.
Topic: Do Not Lose Everything Youve Gained in One day, or One Trade - page 4. (Read 569 times)
it is very important to be most careful while day trading when volatility is high, just as it has been in a few days now, this is specially for those who trade the futures market, trading futures is 10x more risky than trading spot, in futures trading, a simple miscalculation or failure to use proper risk management could lead to you being liquidated and all the money invested gone in a twinkle of an eye.
Best to avoid trading futures in times like this, but if you must, make sure you know what you are doing, and use proper risk management like the stop loss and take profit features, also ensure you are only trading with an amount of money you can afford to lose, and remember not to put all your eggs in one basket.
That is how important to know our capabilities as many traders underestimate the volatility of the market and then try futures trading not knowing how risky it is especially for newcomers. Many of us have been taught that Futures trading is more profitable compared to spot trading and that brings to our attention and courage to choose this one until they realize that it was not. Our common mistake is that we easily believe those people saying this without reading feedback from other traders who tried this. Even though some of them will say that they become successful but it doesn't mean that we can be like them. Best to avoid trading futures in times like this, but if you must, make sure you know what you are doing, and use proper risk management like the stop loss and take profit features, also ensure you are only trading with an amount of money you can afford to lose, and remember not to put all your eggs in one basket.
I have taken a break from future trading for a while now. I don't have that much advance knowledge about trading that I can make profit in this volatile market. So instead of trading right now, I am focusing more on doing DCA to accumulate more. And in the upcoming event of bitcoin halving, we will see a great pump in price for the potential bull run. You can say that day trading is not for me. I have tried it several times but wasn't that much profitable. So I am focusing more on hodling.
The story shared in the OP is a great example for people who are not using risk management. Risk management is a crucial thing when it comes to future trading. The market is volatile and anything could happen at any time. For that reason, if we use stop loss than the losses we make could be minimized to a certain level where it won't affect our future trades. This is a great choice if you don't want to have regret for your decisions.
The story shared in the OP is a great example for people who are not using risk management. Risk management is a crucial thing when it comes to future trading. The market is volatile and anything could happen at any time. For that reason, if we use stop loss than the losses we make could be minimized to a certain level where it won't affect our future trades. This is a great choice if you don't want to have regret for your decisions.
It's literally true that it can happen to any one in times when volatility is very high. In Losing so much just in one trade, Because I've also experience such thing due to false news and miscalculations too.
What most of us want is to catch the bigger fish without much experience in catching any fish at all. What I'm trying to say is that, For instance you know that increasing your leverages to 10X or beyond will trigger your liquidation to take place very fast and increasing your risk in losing, just to gain more profit.When you're not too sure about the market you're jumping into. There's a high chances you may end up losing the money you use to enter the market With liquidation.And the funny thing is that after losing that much you will stop thinking and planning, at that moment your only aim will be getting that money back. And that's when the losses begins.
You just need to focus in risk management, and mind the kind of leverages you're using. Focus more on earning more profit, less losses Than bigger profit and high losses.
What most of us want is to catch the bigger fish without much experience in catching any fish at all. What I'm trying to say is that, For instance you know that increasing your leverages to 10X or beyond will trigger your liquidation to take place very fast and increasing your risk in losing, just to gain more profit.When you're not too sure about the market you're jumping into. There's a high chances you may end up losing the money you use to enter the market With liquidation.And the funny thing is that after losing that much you will stop thinking and planning, at that moment your only aim will be getting that money back. And that's when the losses begins.
You just need to focus in risk management, and mind the kind of leverages you're using. Focus more on earning more profit, less losses Than bigger profit and high losses.
I won't argue that futures trading is likely to make traders lose everything if they are too eager to get rich overnight. I prefer to avoid futures trading even though I am optimistic that I can make a profit through the right strategy, but I will not try that trading so that my long-term plans are not damaged.
Of course there is no harm in taking advantage of futures trading if they understand it well. You also need to limit your budget to start with rather than putting all your honey pot in one fell swoop, even if only 5x can certainly put you at high risk of losing. Spot trading is certainly better to avoid the risk of losing everything, but I tend to believe that long-term investing is a sensible choice.
Futures trading provides an opportunity for traders who want to profit significantly without having a large capital. It is not suitable for new traders who are not yet profitable. If you're new to trading, spot is a preferable option because the risk is lesser than with futures. And if you can be profitable with spot trading, then you can try futures trading. As you mentioned, it's advisable to utilize a small amount of money to avoid large losses. Of course there is no harm in taking advantage of futures trading if they understand it well. You also need to limit your budget to start with rather than putting all your honey pot in one fell swoop, even if only 5x can certainly put you at high risk of losing. Spot trading is certainly better to avoid the risk of losing everything, but I tend to believe that long-term investing is a sensible choice.
Yes, when I was trading without sufficient experience before especially when I was trading with leverage and I didn't use the stop loss I lost all the profits I had made in a single trade or several different trade and the profits I had made from previous trades. Nowadays, even though I use the stop loss if I make several trades during the day, I lose my money or my earnings from previous trades. This is actually a situation that is frequently encountered by everyone who trades with leverage especially those who use high leverage and unfortunately even if we are a very experienced trader it is a possibility that we are likely to encounter frequently when we cannot control our emotions.
Stop lose is an important tool that will aid our earnings and not make us to lose funds any how due to market volatility. Those that understand how the market works will know that trading is not just about the skill alone of the portfolio of knowledge we have acquired. We need to understand the market and how to be safe while trading because it is better to keep the fund available than to lose it due to market volatility we never prepared for. Those that have been in market for many times will understand that trading is more about maintaining a good startegy and discipline to follow trading plans without altering it.
Before trading futures, one must be familiar with spot trading because the rhythm is not very fast. If the market is in a normal condition where it does not rise or fall too quickly, he can trade without a rush. But if the market moves quickly and he can't keep up, he will make wrong decisions and if he is inexperienced, it will only make his losses bigger.
Futures trading is riskier because if he puts all his capital in the trade but the market suddenly changes direction before closing the trade, he could lose all his money. But it depends on what mode he uses, isolated or cross. If he uses the cross method, it will use up all the money in his balance until the market moves in the direction he is trading. And he must also understand when to place a stop loss to reduce the amount of his losses.
Nowadays, we have to be more careful because there are sudden reversals in direction and if we are inexperienced, we can make mistakes in analyzing and making decisions. If he wants to trade in futures trading, it is best not to use too large capital. That would be better because he wouldn't lose as much if he lost.
Futures trading is riskier because if he puts all his capital in the trade but the market suddenly changes direction before closing the trade, he could lose all his money. But it depends on what mode he uses, isolated or cross. If he uses the cross method, it will use up all the money in his balance until the market moves in the direction he is trading. And he must also understand when to place a stop loss to reduce the amount of his losses.
Nowadays, we have to be more careful because there are sudden reversals in direction and if we are inexperienced, we can make mistakes in analyzing and making decisions. If he wants to trade in futures trading, it is best not to use too large capital. That would be better because he wouldn't lose as much if he lost.
I won't argue that futures trading is likely to make traders lose everything if they are too eager to get rich overnight. I prefer to avoid futures trading even though I am optimistic that I can make a profit through the right strategy, but I will not try that trading so that my long-term plans are not damaged.
Of course there is no harm in taking advantage of futures trading if they understand it well. You also need to limit your budget to start with rather than putting all your honey pot in one fell swoop, even if only 5x can certainly put you at high risk of losing. Spot trading is certainly better to avoid the risk of losing everything, but I tend to believe that long-term investing is a sensible choice.
Of course there is no harm in taking advantage of futures trading if they understand it well. You also need to limit your budget to start with rather than putting all your honey pot in one fell swoop, even if only 5x can certainly put you at high risk of losing. Spot trading is certainly better to avoid the risk of losing everything, but I tend to believe that long-term investing is a sensible choice.
Yes, when I was trading without sufficient experience before especially when I was trading with leverage and I didn't use the stop loss I lost all the profits I had made in a single trade or several different trade and the profits I had made from previous trades. Nowadays, even though I use the stop loss if I make several trades during the day, I lose my money or my earnings from previous trades. This is actually a situation that is frequently encountered by everyone who trades with leverage especially those who use high leverage and unfortunately even if we are a very experienced trader it is a possibility that we are likely to encounter frequently when we cannot control our emotions.
This experience for me showed that he was really inexperienced when it comes to trading futures, but the truth is that, such a thing can happen to anyone in times when volatility is very high, when price runs become really high, it makes sure to liquidate both long and short position in a matter of seconds and minutes, most especially, if you open a position with a very high leverage.
From what you describe, your partner was probably successful in his first few trades and he became confident with his subsequent trades. I'm not saying your friend doesn't have trading skills, but maybe he lacks experience in dealing with market news. what was clear was that it destroyed the trading plan he had made.especially if you open a trade with high leverage, you may hope to catch up on losses. but he may unknowingly have increased his risk of greater loss. even draining all his money.
tell him to stop and try DCA for Bitcoin. maybe he will know a little about how to make a profit.
According to him, he went long with all of his entire crypto NetWorth on an Altcoin because he was expecting the price of the altcoin to jump back up, after a news (which was later confirmed to be fake) caused the cryptocurrency to go down, but unfortunately for him, by the time he woke up from sleep the next day, on checking on this trade, he discovered that he had been completely liquidated because the price of the crypto currency ended up dumping even harder than before.
Anxiety and fear made me deposit more money and he try to see if he could DCA the dip and make some of the money he lost back, and at a point, the price reached his take profit target but unfortunately, the take profit did not fill before the price of the altcoin shoot up again and at end, he was liquidated again.
I think the friend learned his lesson here. Everyone has their mistakes to learn from right? It is just very unfortunate of him because he made so many wrong things at once. First off, putting all your money into one cryptocurrency is like going all in at a poker game, its super risky. Also he acted on unverified news
he should have calmed down first and did his research.I think he also let his emotions prevail as he wanted to recover losses by pouring in more money. It might seem like a good idea in the heat of the moment but it just made things worse for him We all need patience in this crypto world. Prices can swing wildly so jumping the gun and not waiting for the right moment can burn anyone.
Gains could really be taken back if you would really be continue on doing the same mistake. You should really be that mindful on whatever steps that you would really be making. There's no such thing
about having no risks and this is something that you should really be targeting on,because on the time that you would really touching up this floor then
there's no easy way on dealing with it.Every steps do matter and the actions would be made.
From the narration of this your story, I could guess that the trader did not use stop-lose loss which led to his account being liquidated, Secondly, he as well did not use proper risk management, he might have used high leverage which he would not really tell you was the actual cause for the account liquidation, So these two things to me majorly will lead to such liquidation of an account. There is a leverage that you will use, no matter how the market parades you won't get liquidated.
From my personal experience, all the times I have been liquidated was as a result of
1. Using high leverage or lots size to trade.
2. No use of trading stops (stop loss).
What the market hates most is to see greedy traders, and to deal with them, the market moves to ensure they get liquidated.
From my personal experience, all the times I have been liquidated was as a result of
1. Using high leverage or lots size to trade.
2. No use of trading stops (stop loss).
What the market hates most is to see greedy traders, and to deal with them, the market moves to ensure they get liquidated.
The higher the profit the higher the risk, that's life if you can't take the risk you can't get the higher reward or profit. This kind of action can be an expensive lesson, this is the reason why you must have a trading plan and stick with it or else you will suffer like this For example, people make a lot of trades and once they lose trade has a bigger lose they are trying to make a risk to earn those backs. Consistency is the key at the end of the day your profit counts even though it's just a small trade. Know your limit, know your budget. Its not hard to set a TP/SL in trades people always tired to use this feature.
According to him, he went long with all of his entire crypto NetWorth on an Altcoin because he was expecting the price of the altcoin to jump back up, after a news (which was later confirmed to be fake) caused the cryptocurrency to go down, but unfortunately for him, by the time he woke up from sleep the next day, on checking on this trade, he discovered that he had been completely liquidated because the price of the crypto currency ended up dumping even harder than before.
Anxiety and fear made me deposit more money and he try to see if he could DCA the dip and make some of the money he lost back, and at a point, the price reached his take profit target but unfortunately, the take profit did not fill before the price of the altcoin shoot up again and at end, he was liquidated again.
I think the friend learned his lesson here. Everyone has their mistakes to learn from right? It is just very unfortunate of him because he made so many wrong things at once. First off, putting all your money into one cryptocurrency is like going all in at a poker game, its super risky. Also he acted on unverified news
he should have calmed down first and did his research.I think he also let his emotions prevail as he wanted to recover losses by pouring in more money. It might seem like a good idea in the heat of the moment but it just made things worse for him We all need patience in this crypto world. Prices can swing wildly so jumping the gun and not waiting for the right moment can burn anyone.
Most people are simply not fit for using leverage, or even trading in general. Overall in my entire time in the crypto space, I made most of my money just trading altcoins using spot. Leverage always managed to mess me over due to those sharp wicks, despite me being directionally correct.
Leverages are for gamblers and I say so because most of traders are not professional traders. They are not winners but losers and if they can not get profit from Spot trading, how do they get profit from Leverage trading?I am sure they will lose more money to Leverage trading and even lose at faster rate than with Spot trading.
Trading altcoins are risky too and you have to choose altcoins will less risk of rug pulls, sudden inflation from their Mint functions to protect your capital. I am not sure what you did but with me, I prioritize Proof of Work altcoins than Smart Contract altcoins for Spot trading. I usually wait for each bull run to start trading altcoins when risk is smaller and at least I know most of coins will rise or don't fall in a market bull run.
Best to avoid trading futures in times like this, but if you must, make sure you know what you are doing, and use proper risk management like the stop loss and take profit features, also ensure you are only trading with an amount of money you can afford to lose, and remember not to put all your eggs in one basket.
Well, it's really not a best practice in trading when you go YOLO (You Only Live Once) trade or like an all-in trade just like gambling.Because for me, capital preservation is extremely important in trading, the more you have available capital, the more you have a chance to make more successful trades in the future.
it is very important to be most careful while day trading when volatility is high, just as it has been in a few days now, this is specially for those who trade the futures market, trading futures is 10x more risky than trading spot, in futures trading, a simple miscalculation or failure to use proper risk management could lead to you being liquidated and all the money invested gone in a twinkle of an eye.
I am sharing this based on a story a friend of mine told me yesterday about how he lost crypto NetWorth in just one trade on one faithful day way back last upper year which is 2022.
According to him, he went long with all of his entire crypto NetWorth on an Altcoin because he was expecting the price of the altcoin to jump back up, after a news (which was later confirmed to be fake) caused the cryptocurrency to go down, but unfortunately for him, by the time he woke up from sleep the next day, on checking on this trade, he discovered that he had been completely liquidated because the price of the crypto currency ended up dumping even harder than before.
Anxiety and fear made me deposit more money and he try to see if he could DCA the dip and make some of the money he lost back, and at a point, the price reached his take profit target but unfortunately, the take profit did not fill before the price of the altcoin shoot up again and at end, he was liquidated again.
This experience for me showed that he was really inexperienced when it comes to trading futures, but the truth is that, such a thing can happen to anyone in times when volatility is very high, when price runs become really high, it makes sure to liquidate both long and short position in a matter of seconds and minutes, most especially, if you open a position with a very high leverage.
Best to avoid trading futures in times like this, but if you must, make sure you know what you are doing, and use proper risk management like the stop loss and take profit features, also ensure you are only trading with an amount of money you can afford to lose, and remember not to put all your eggs in one basket.
Happy trading ya all.
I am sharing this based on a story a friend of mine told me yesterday about how he lost crypto NetWorth in just one trade on one faithful day way back last upper year which is 2022.
According to him, he went long with all of his entire crypto NetWorth on an Altcoin because he was expecting the price of the altcoin to jump back up, after a news (which was later confirmed to be fake) caused the cryptocurrency to go down, but unfortunately for him, by the time he woke up from sleep the next day, on checking on this trade, he discovered that he had been completely liquidated because the price of the crypto currency ended up dumping even harder than before.
Anxiety and fear made me deposit more money and he try to see if he could DCA the dip and make some of the money he lost back, and at a point, the price reached his take profit target but unfortunately, the take profit did not fill before the price of the altcoin shoot up again and at end, he was liquidated again.
This experience for me showed that he was really inexperienced when it comes to trading futures, but the truth is that, such a thing can happen to anyone in times when volatility is very high, when price runs become really high, it makes sure to liquidate both long and short position in a matter of seconds and minutes, most especially, if you open a position with a very high leverage.
Best to avoid trading futures in times like this, but if you must, make sure you know what you are doing, and use proper risk management like the stop loss and take profit features, also ensure you are only trading with an amount of money you can afford to lose, and remember not to put all your eggs in one basket.
Happy trading ya all.
Experienced or not, unexpected things would really happen as the market is always the master. But yes, experience has the edge when it comes to reading the TAs, possible scenarios, etc. However, there are no promises or guarantees that our analysis and/or insights would be accurate especially that the market is so highly volatile due to the recent rally.
If I were in his shoes to have lesser disappointment, it's much better to "avoid going all-in" with my hard earned savings, assets, etc. In my own insight about that guy you've mentioned, I think risk management is what he is lacking and was not prepared for this scenario.
I think he is also greedy by not setting the stop loss and take profit, but correct me if I'm wrong though. Always acknowledge the risks and managing at the same time would be very essential so that you won't run out of funds especially for emergency purposes.
This experience for me showed that he was really inexperienced when it comes to trading futures, but the truth is that, such a thing can happen to anyone
It can happen to anyone who under gauges the important and necessity of having experience before trying out some forms of trading. It takes time and practice to get experienced and master some kinds of trading. New traders who usually have this understanding about the need for experience save themselves from some discouraging trading experience that can make them to want to stop trading. If you lack experience, try to tap from the experience of another trader who has been longer in the market, by asking them reasonable and sensitive questions, and then paying attention to answers. 
Crypto trading is not for the faint hearted reading all these stories we read about trading, and it's unfortunate your buddy was caught up in a bad trade, imagine what would have happened had that trade gone his way...it would mean next time he might be twice as confident and would have lost more money !!! If you ask me its good that it happened now for him/her to use risk management in his trading.
Secondly to trade Altcoins takes a special skill to be profitable because these are easy to manipulate as they have low liquidity...and to avoid losses go for high liquid trades to avoid being used as the liquidity.
Lastly experience is the best teacher and it's good he went through this class to be more prudent, good luck to our friend hope he recovers his losses...
Secondly to trade Altcoins takes a special skill to be profitable because these are easy to manipulate as they have low liquidity...and to avoid losses go for high liquid trades to avoid being used as the liquidity.
Lastly experience is the best teacher and it's good he went through this class to be more prudent, good luck to our friend hope he recovers his losses...
Always have you limit and always do risk management, better not to trade the whole day and know when to stop. Trading can be tempting most of the time since you tempted to trade more especially if you are making profit, but then again if you have your target and you already reached it better to stop and come back again with your new strategy. Day trader should also understand this and have their limit every time they trade.
Day trader must know this, and understand the risk of being too exposed everyday and I’d hope that they still have a balanced life. Having a target is always advisable and if you really want to make profit, then is about being responsible. I did mistakes before about being greedy and losing everything at one trade before, and now I already know what to do and know how to approach the market, trading can be more profitable if you are responsible. Jump to: