Trading lessons for beginners

Still feeling the pain of using way too much leverage and getting liquidated? I mean, it’s a bummer when the market flips back to your entry price after you've lost everything. You could’ve made a profit if your funds weren’t wiped out. Just thought I'd share this for fun today. Hoping other newbies can pick up on how risky leverage really is. I've been through this way too many times myself. What about you? Have you faced something similar?

I think most of us have been through this. I’ve been through it a few times myself. So in those situations, I sometimes find myself thinking, “If only I had more capital so I could set my liquidation level far enough away to avoid getting liquidated, then maybe I’d make a huge profit.” But then I realized that I personally am simply not suited for trading in the futures market with high leverage. Because I’m quite poor at managing the risks I take. So I also think that leverage is indeed quite dangerous for those who lack discipline in risk management and for those who truly haven’t mastered the right timing to enter and exit positions. However, for those who are disciplined enough, the futures market with moderate leverage can actually be a great opportunity to double profits. The problem is that we’re sometimes disciplined enough in the spot market, but in the futures market, we become less disciplined. At least, I’ve experienced that myself.

I don't have much experience with futures trading because I rarely do futures trading. Most of the time I have traded, I have traded spot because I don't want to take too much risk. Also, I always think that futures trading is very risky where I can lose all my money in a moment because I don't want to lose money and I don't want to suffer too much damage, which is why I try to avoid futures trading. However, you are right that when money is liquidated from futures trading, there is regret because the market turns around very soon after the liquidation and it is really a lot of regret.

Definitely, everyone has such thoughts, but the fact that the market doesn't really care how much capital you have is something we can have at the back of our mind while trading. We know that having large capital increases your rewards but it also increases you risk and some traders most times out of greed use high leverages than they normally do hoping that this one single trade would be the life changer for them. The market just has a way of manipulating one into thinking that it's actually going to work. Without the right knowledge of the market you will just be another retail liquidity. The market would simply liquidate your position and then move slowly back in to the price which you had anticipated earlier..

Yeah happened in the past and I always got sick when I remembered it since its like playing my emotions and that time. Cause I won some on high leverage but some of my trades also hit me bad with that set up and just like you share same pattern and situation seen my trade goes up but my position already got rekt prior to what should happened which I ecpect to happen but did happened afterwards my money gone. Kek. Really a newbie experience!

I do not trade futures contracts and I do not use leverage because I believe that it is like gambling, it is very risky and depends more on luck than on study and analysis. No matter how expert you are in analysis, anything can happen that changes the direction of the market and you will be exposed to double loss. But despite that, I know this feeling because it sometimes happens even in spot trading where I buy a coin and it starts to go down, so I sell it immediately to avoid further losses but after that the trend suddenly changes and the coin goes up significantly and I wish I had waited a little longer.

Most traders experience it and will continue becoming liquidity as long as they are unable to spot liquidity; it is a liquidity sweep. Understanding liquidity sweeps and being able to identify them will help your entries better as well as you setting stop losses.

The reality is that no newbie should be doing leverage, anything that could send your entire bet into zero is not something you should do if you are a newbie. I understand the desire for it, there are a lot of people who got rich doing that and newbies also think that it is possible and they want to do it. But the sad truth is that if you do something like this then you are not going to get a great result from it neither. You should be considering how this could be a big risk for you without a doubt. I think if you are a newbie, best way to start would be long term DCA method, and then small amounts for regular spot trading, keep doing that as long as you can, until you are making profit and getting some good results from it.

I have experienced it many times, and members are saying they are not in futures so they have not experienced it, but what you are describing is a phenomenon that we call artificial manipulation. When we buy the token, it dumps because on the liquidation heatmap or on RSI or using MACD we can confirm what the support is. So manipulation has always been at its peak because just like we think it will dump to the stop loss where we could get liquidated, what we do is we open buy orders from that liquidation price in a second trade, and due to the buying pressure building at that specific price, it usually dumps and those who are not doing it get liquidated. But in futures we have to use our mind, and if it is not sharp, then we could struggle here.

Every consistent trader must have had this experience once or twice, but the issue is if they acted on their emotions and tried to revenge trade to see if they can make back the money they just lost. Newbie traders should try to learn from the experience of others before them, so as to save themselves the trouble of having to suffer loss twice. They should use like 2x or 3x leverage just to be safe and survive any dip before a moon. The stories of liquidation sweep are all same but the smart ones learn the safest path to be profitable for longer.

I tried it before but it seems that I can't do that for a long time. The movement is so risky there and very quick and that's why for those who can't dedicate their time for their trades, they better let go of futures and have to stay with the spot trading. There's nothing wrong if a newbie tries to learn the futures but if they understand it that it can't be the style they want to as they learn how to trade. They should change their plans and forget about the futures trading because they'll only see how it's like a gambling for all, newbies and not.

Exactly mate, most at times as a trader your analysis are actually correct but the biggest threat most traders have is their market entry position, this is the reason why most at times when you see the market sweeps liquidity it normally liquidates many traders before heading in their direction and one of the most common sweeps is those fair value gap, order block or breaker block traders are usually the most hunted ones in liquidity sweeps because they do not pay attention to liquidity sweeps in opposite direction. Traders should always consider liquidity sweeps and most importantly a market structure shift. Leverage as said by OP is the easiest tool to get liquidated and then the trade goes your way because of high liquidation.

The lesson here, don't be too aggressive to win and expect profits, the market will eventually do you a favor, patience is the key. But sometimes, you have to lose first and learn your lesson, before you can handle the market well. Its unfortunate for others who always took leverage as their first step. Honestly, I was never an exception. I though that through leveraging, I can make instant higher profits, but I guess this does not apply for amateur traders. It takes experienced and expert traders to start leveraging, but even some of them still fail on it.

I believe many of us have much experienced about that moment where open position with maximum leverage but not support much margin fund avoid from liquidation, right now many new comer in cryptocurrency trading exactly in future don't care about how much back up fund to avoid from liquidation but many of them take care only how maximum leverage set up for their trading position opening as long or short position. I don't the newbie take have fun when opening position in future trading because many of them expect much profit by set up maximum leverage but less support how near close with liquidation. Its dangerous way or concept or newbie trading in future without make analyst and take care about liquidation position how too close or not, so change the mindset about future trading high risk but you have accept consequence with future trading has high risk.

In trading as a new trader to the market profits shouldn’t be what we put into consideration instead we focus on how to gain much knowledge and experience about the market and how to manage our risk in this volatile market. As a new trader let build our knowledge and not see profits so fast, the more knowledge and experience we gain in the market the higher chances of us making profits from the market and also let stay patient.  A lot of experience and challenges we will face in the market and it all part of the journey so let not get discouraged or see this challenges and negative experiences as a bad thing, it all a process to success when proper mindset is given to it. Don’t rush into making decisions or opening positions, analyze and strategize a lot of factors before any entry and minimum lot size to reduce the risk.

That feeling of frustration when you got liquidated, and the fact that it went the way you opened the position just adds to the frustration that you've already experienced. Double frustration indeed. I've experienced this multiple times back when I'm still a newbie in trading. No stop-loss, my risk is too high, my leverage is too high and whenever I lose, I always feel that I want to recover those losses in a short amount of time therefore, I will open another position again at a much higher leverage and much higher risk. Overall, that's the reason why I'm getting liquidated back then. I will never forget those moments unless I quit trading totally. Those experiences that I got in the past is the reason why I'm more cautious now when it comes to my positions and my emotions as well. To those newbies out there who wants to try trading, I don't discourage you to do it because you can, but while on your journey, you'll get so many challenges that will make you crumble. You'll experience lots of losses, and those losses will affect you psychologically.

This is not just only about newbies but also many other traders. There are many traders that supposed to have been better traders, but their problem is the use of high leverages. They will not use 2 or 3x leverages, but they will use something like 25x to 40x  or more which is very risky. Newbies should not use such high leverage, but other traders should also stay away from high leverage if they do not want to be like James Wynn that was using 40x leverage, but blaming his loss on market manipulation.

Using high leverage makes your heart beat faster following the market situation and if you are not ready with the lose, you don't have forcing yourself to enter the market without preparation. I have many bad experiences using high leverage and although I've got that, I sometime using high leverage The desire to recover my losses still there without I can eliminate 100% but I am trying to control myself not just follow them. But the feeling will be paid when we see the profit coming to us, more than the money we risked. That is the golden moment that we should take it and get out from the market, even the price still showing the chance to go up.

When this happens in first periods of experience it almost makes the trader thinking that some persons somewhere are manipulating the market price movement against you But it is just the trader who has not really gotten a hold of his self discipline in application to when to open a trading position and with what leverage to use base on your account size, to what liquidity it can take long enough before exhausting just in case the price reverse back to your profit direction.. Most often we see traders focusing on what is to be profited above the high risk of losing the trade and this makes them lose sight of risk management.

This is the problem with trading, your idea may be right in the end but your luck is so bad that you can get liquidated before you make a profit. This is what happens to traders when the market goes against a trader, liquidating the position. Then it may come back in the direction the trader wanted. But then you regret it. And new traders only think about whether the price will go up or down. But they don't value thinking about how much the market can go against them.