Four Secrets to Making Money with Perpetual Contracts in the Crypto Market

Making money with perpetual contracts in the crypto market isn't easy, but it's not impossible either. Today, I want to share some practical tips that I personally find useful, hoping to help everyone.
1️⃣ Reasonable Capital Allocation
First of all, capital allocation is a big issue. You need to figure out the maximum loss you can tolerate. For example, if you have 200,000 and can lose up to 20%, that's 40,000. The most aggressive allocation plan would be: lose 10,000 on the first trade, 10,000 on the second, and 20,000 on the third. Even if all three fail, you still have 140,000 left. Plus, as long as you get one right, you can recover your losses.
2️⃣ Grasp the Overall Market Trend
Trend trading is much more difficult than range trading because trends involve chasing the highs and selling the lows, requiring strong discipline. In an uptrend, any violent pullback is a good opportunity to go long. Remember, the more it aligns with human nature, the less likely it is to be profitable, because making money is hard.
3️⃣ Set Take Profit and Stop Loss Targets
Setting take profit and stop loss is crucial. Each stop loss should not exceed 5% of your total capital, and each take profit should be more than 5%. The overall win rate should be above 50%. As long as these conditions are met, you can profit. Of course, the best scenario is a risk-reward ratio greater than 1 with a win rate over 50%.
4️⃣ Avoid Overtrading
Perpetual contracts are traded 24/7, and many beginners are constantly trading throughout the day. This easily leads to mistakes, and a bad mindset can cause poor decisions. Remember, if you keep walking by the river, you will get your shoes wet. Overtrading always leads to mistakes.