I have a friend who trades BTC and used to get margin called every month. Later, he turned things around by strictly following three ironclad rules—starting with a $5,000 capital, he grew it to $80,000 in three months through relentless discipline.

He once told me a phrase that left a deep impression: "Before, full position was risking my life; now, position control is saving my life."

Here's how I break down his risk management system, which is especially effective before major market events like US CPI and non-farm payroll data:

**Rule 1: Keep each position within 20% of total capital**

It sounds conservative, but it actually leaves room for survival. Small losses won't damage your core, and when big moves come, you still have ammunition to add to your positions. Many people get wiped out by going all-in on one trade; a market correction can wipe out their chance to recover.

**Rule 2: Trigger a 3% stop-loss on any single loss**

This rule is particularly strict. You can survive multiple mistakes, but one heavy mistake with a large position can wipe you out. 3% may sound high, but in high-leverage trading, it's already a very disciplined limit. Sticking to this rule essentially blocks your account from being wiped out.

**Rule 3: Only trade breakouts; stay on the sidelines during choppy, sideways markets**

This is the hardest to follow. In ranging markets, there are tempting "cheap" opportunities, but they often lead to quick losses of capital. Major Bitcoin moves usually come with macroeconomic shifts—like now, during the busy release of US economic data, breakouts are the real opportunities.

In essence, these three rules boil down to: survive longer, earn steadily.