I have a friend who, on his very first try with contracts, made profits for two days in a row and tripled his account. Back then, he’d tell everyone, “This thing is even better than an ATM.” But on the third day, the market suddenly plunged, and all his gains—principal and interest—were wiped out. That night, after getting liquidated, he sat in front of his computer in a daze and finally understood one thing: high leverage is never a money-printing machine. It’s a magnifying glass that can blow up your errors in judgment until you lose everything.

**The funding rate is actually a thermometer for market sentiment**

Is the long funding rate spiking? That means everyone is scrambling to go long, which usually indicates that short-term top risks are building up. Did the short funding rate turn negative? That’s a signal of spreading panic, which could actually set the stage for a rebound. The real pros don’t just stare at candlesticks—unusual swings in the funding rate are what prompt them to adjust their positions.

**Leverage should be used like a scalpel, not swung around like a broadsword**

The most common rookie mistake is thinking only 20x or 50x leverage is exciting enough. In reality, 3x to 5x leverage is plenty for you to practice position control. Once you go above 10x, even a small market shake can kick you out of the game. Surviving in the market is a hundred times more important than making quick gains. If you can’t manage your positions, even the right call won’t help you.

**Clear these four hurdles before opening a position and you’ll save yourself a lot of tuition**

First, look at the larger trend—the daily chart tells you which way the wind is blowing, so don’t get dizzy from small moves on the 15-minute chart.

Second, find your entry timing—wait for the 4-hour chart to pull back to the middle Bollinger Band, RSI to enter oversold territory and start to rebound, and for trading volume to spike. Only act when all three conditions are met.

Third, set your stop loss in stone—if a single loss hits 2% of your principal, cut it immediately. Don’t get greedy or hopeful.

Fourth, stick to your take-profit rules—start taking profits in batches once you’re up over 20%. Don’t expect to get the very last bite.

**Always keep some “winter rations” on hand**

Limit any single coin position to no more than 30% of your total funds; keep at least 40% in cash to handle sudden crashes; there are opportunities every day, but if you lose your principal, all you can do is watch from the sidelines.

The real winners in this market don’t rely on predicting perfectly, but on rock-solid risk control. Stay out when the trend is unclear, go heavy only when the signal is strong, and don’t hesitate to cut your losses when you need to. If you can stick to these three rules, you’ll have found your footing in this game of human nature.