2026-01-01 14:51:49

For centuries, trading contracts was done with low leverage. Do you know why? There is a saying: "Boiling water makes a frog jump," because you use low leverage and don't feel much risk, so over time your position becomes deeper and deeper. Then, with a lot of funds in your portfolio, you keep adding positions, and the more you add, the more you fall into the trap. That's why the size of leverage in contracts is not as important as whether you set a stop-loss. If you don't set one, who will stop you in case of losses? Do you agree?

Although low leverage seems less risky due to its stability and moderate volatility, it can easily lull you into complacency, like water heating up — and before you know it, your position becomes increasingly deep. Many traders constantly add to their positions, gradually falling deeper into the trap, which leads to significant losses.
The main issue is not the size of the leverage but strict adherence to stop-loss rules. No matter what leverage you have — trading without a stop-loss is like driving without a seatbelt: in extreme market conditions, you'll be quickly knocked out of the game. The stop-loss is the most important capital protection tool; it allows you to quickly exit a position when your forecasts are wrong and preserve most of your funds.
In contract trading, it is crucial to have a clear understanding of risk management, set reasonable stop-loss levels, and strictly follow them — this is the foundation of long-term survival.
The essence of range trading is to predict that the price will fluctuate within a certain range, making profits on high sales and low purchases. But when the market breaks out of the trend, whether upward or downward, a strategy with two-way orders becomes very risky:
Why might you get "stuck"?
1. Directional mistake: long or short positions will constantly incur losses, while opposite orders may not trigger, failing to create a hedge.
2. The trap of adding positions: many traders keep adding to the losing side to reduce the average price, but end up falling even deeper and increasing their position size.
3. Lack of liquidity: in trending conditions, prices move quickly, and stop orders may not execute in time, causing slippage.
4. Psychological pressure: seeing losses grow can create a false sense of hope, ignoring the stop-loss, which ultimately leads to liquidation.
The correct approach — if you are trading within a range — is to strictly set stop-losses, and when the boundary is broken, quickly admit the mistake and exit the position, rather than holding on and adding more. It is also important to manage volumes properly — do not risk large sums due to low leverage.

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playerYU

2026-01-01 10:54:40

Since ancient times, those caught in contracts have used low leverage. Do you know why? There's a saying called "boiling frogs in warm water," because with low leverage, you don't feel much, and you'll get deeper and deeper into the trap. Then, as you hold more funds in your position, you keep adding to your position, becoming more and more trapped. The more you add, the deeper you get, and the more trapped you become. So, whether the leverage is high or low doesn't matter; what's important is whether you set a stop loss. If you don't set a stop loss, who will blow up if not you? Do you agree?

Although low leverage seems to carry less risk, it's precisely because of the relatively gentle fluctuations that people tend to relax their vigilance, just like boiling frogs in warm water—unconsciously, their positions become more and more trapped. Many people keep adding to their positions, resulting in deeper traps and ultimately heavy losses.

The core issue isn't the size of the leverage but whether you strictly follow the stop loss discipline. Regardless of high or low leverage, not setting a stop loss is like driving without a seatbelt. When extreme market conditions hit, it's easy to be eliminated by the market. Stop loss is the most important line of defense to protect your principal, allowing you to exit timely when your judgment is wrong and preserve most of your funds.

In contract trading, the key is to have a strict risk management mindset, set reasonable stop loss levels, and resolutely execute them. This is the fundamental way to survive long-term.

The essence of range trading is to predict that the price will oscillate within a certain range, making profits through high selling and low buying. But once the market breaks out of a unidirectional trend—whether upward or downward—this bidirectional order strategy faces huge risks:

Why get trapped and killed?
1. Wrong direction judgment: Long or short positions on one side will keep losing, while the opposite orders may not be executed at all, failing to form a hedge.
2. Averaging trap: Many people keep adding to losing positions to dilute costs, resulting in deeper traps and heavier positions.
3. Liquidity exhaustion: In a unidirectional trend, prices move quickly, and stop-loss orders may not be executed in time, causing slippage losses.
4. Psychological pressure: Watching losses grow continuously, leading to overconfidence and reluctance to stop loss, ultimately causing liquidation.

The correct approach should be: if you want to do range trading, you must set strict stop losses. Once the price breaks the range boundary, admit your mistake and exit promptly, rather than stubbornly holding or constantly adding to positions. At the same time, position management should be reasonable; don't over-leverage just because your leverage is low.

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