Cartman's Pro Guide to Margin Trading on Bitmex v2.0
Kubusia Aug 18th, 2018 35 Never
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- Cartman's Pro Guide to Margin Trading on Bitmex v2.0
- -Don't enter trade too early - don't rush in = dont FOMO, try to use limit orders instead of market orders at least 80% of the time
- -Wait for a good setup to develop (entry), good Risk and return ratio before entering a position.
- -Mistake: Not planning the trade according to current pattern (entry and exit, stop loss) before putting trade on
- -Don't use too high leverage - SUPER IMPORTANT - Use 3x-5x for super low risk, 10-25 for medium risk but still safe, 50-75 for higher risk and mostly scalps.
- -Mistake: Not planning stop losses, ALWAYS USE MARKET STOPS cause limits wont hit a lot of the time.
- -Don’t enter a trade just before testing an important resistance/support after several hits of them, since it could easily end up breaking it after several touches and u get rekt
- -Mistake: Not waiting for candle closes for confirmation before entering a trade. Also, after the close, the candle that comes next is called the confirmation candle, this is more important than the previous one most of the times cause it determines if the pattern is correct/broken or if it will go back on track if the confirmation candle reverses.
- -Mistake: Not taking profit on your winners. Ex. If the trend is down and your long scalp was a winner, take profit cause youre counter trending.
- -Mistake: Not closing a percentage of the winning PNL profit (ties with the previous point).
- -Don't close all the position if its going well, ride your winners, only fully close position after you see weakness.
- -If in red and if analysis not working out, take the hit and close, you can always enter trade again. Don’t be delusional and think it will reverse in your favor cause 90% of the times it wont and the loss will keep growing.
- -HUGE MISTAKE: Don't average your entry if you're already in the red (don’t keep adding to a loser). This could make your loss way bigger than originally thought. Sometimes you lose more protecting a position than the amount you would lose if you just take the hit and close or just let it liquidate.
- -COLOSSAL MISTAKE: Never get fully liquidated. Set a stop at Mark at least 10 points away from your liquidation price. If you get liquidated you lose 100%, if you close right before liquidation you get some of it back.
- -DO: overextend your targets (entries, exits), account for wicks, leave buy/sells higher or lower than you expect since bitmex overextends more than other exchanges by around 30-80 points
- -wait trade out and don’t close too early based on candle patterns.
- -use candle patterns, trendlines, s&r horizontal levels, fib retracement tool, volume profiles to determine exit/entries.
- -If your analysis checks out trust your instinct and put on the trade without hesitation. I can’t stress this enough.
- -Don’t put on big trades sleepy/after waking up, and if youre on a trade ALWAYS have a stop loss.
- -NEVER add (margin or contracts) to losers - SUPER IMPORTANT, im reiterating this point again cause its that important.
- -always have an emergency market stop loss - SUPER IMPORTANT, again stressing this.
- -don’t leave big trades unattended, or sleep on them, use tradingview alarms for waking up, and then watch the price action and determine what you think will happen.
- -check funding before putting on a trade to see what will probably happen. Ex. 30 mins before big funding % there will be a pump on the contrary side that pays. Ex if longs get paid it will pump, if shorts get paid it will dump 30 mins before funding.
- -Adding to the previous point, big funding usually reverses the trend, example last time we almost got to 10k on btc, funding started to get .3% (highest funding possible), so big shorts started opening and we dumped almost 2,000 points in a day or 2. Even a 1% funding is big enough to start slowing or reversing a trend.
- -If already very green in your position don’t add more contracts while on the resistance/support waiting for another pump/dump - SUPER IMPORTANT, add more contracts after the resistance/support breaks and confirms above/below it (depending if youre short/long)
- -Never put on the whole account on a single trade - SUPER IMPORTANT, probably the most important point of all. Using Cross margin uses your whole account, use isolated margin to avoid blowing your account in a single or a few trades gone wrong.
- -Set your entry/exit/stops beforehand since bitmex will overload when you try to get in or – SUPER IMPORTANT
- -Im not a big fan of laddering bids/asks since youre basically adding to a loser if it keeps going beyond your first fill. If you do this, make the first orders to fill smaller and the last ones bigger so you average better.
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