What every beginner crypto trader should know before trading crypto on futures

Trading crypto on futures is one of the ways of earning real time cash. You can also leverage trade with futures, thus increasing your chances of earning huge  profits. However, just as huge profits can be gotten through futures trading, any crypto trader can also loose all his/her funds in just a single trade. This is because the crypto markets are very volatile and jumping into any trade without proper technical analysis can cause you to loose your funds. In this article we discuss on things every beginner trader should know before trading on futures.

1. Trading strategy: before trading on futures you should ensure that you work with a trading strategy. Trading with emotions or feelings or hope could cause massive liquidation. It is advisible that before going on live trading with any trading strategy, you should test-run the strategy with about a hundred trades using the currency you which to trade on a demo account. From your trades using a demo account you can then calculate how efficient the stategy is and choose whether to use or abandon it.

2. Risk management: every beginner trader should consider risk management before trading on futures. Without the right risk management all your funds could get liquidated at once. No matter how sure you are of the trade you should not risk 2-5% of your account on any single trade as no one can predict accurately how the market would go.

3. Trading psychology: this is a very important factor. Most beginner traders get liquidated not because of the wrong risk management or trading strategy but because they have the wrong trading psychology. If you are sure of your trading strategy and you use the right risk management then you should be sure of winning. However most beginner traders tend to close their trades early due to fear, making them to have losses or earn little profits.

 

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