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September 28, 2024

Here is why you should use leveraged trading with very caution

Filed under: Trading — admin @ 5:57 am

Friday, 27 sep 2024, this is what happened

On Kucoin for example, as the volatility was too important, it was very easy in these market conditions for the market makers to win and to liquidate their customers leveraged positions. Crypto leveraged futures trading is a very risky game for the retail trader on most brokerage platforms.

Below you can see a dangerous 240% change doji candle in 2 minutes. With this kind of huge volatility, this explains why you should use leverage with very caution.

Yet, on the ZERO/USD chart on linea network via geckoterminal.com you can see that the price arbitrage was more fairplay. This is a common case of fraud on the crypto market. I repeat, use leverage with very caution.
This is what happens when crypto markets are not enough regulated, market makers become sharks and want to eat everything, especially leveraged positions.

Rules: use leverage with caution or leverage x1 = less risk of liquidation
Use 1/3 of capital per position max. Use the remaining 1/3 and 1/3 in case you are under the water.
Use tp and sl instead of close at market price to increase your chance of winning position when you scalp.

Enter a leveraged position only if you use Vegas indi well configured (with all other indis) with a small part of your capital, when price reach the third orange line of Vegas (see pictures below). If you do not use Vegas, do not use leverage.

Cheers

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