Tips & Tricks for Smart Bitmex Traders
Bitmex Lifestyle is one of the channels we followed from the start and observe their progress. They evolve and grow nicely and their trades have always safety in mind. Recently, we got a small gift for your by their admin: an article full of valuable BitMEX tips. Today, we are happy to present you three more of them for you.
To leverage or not to leverage?
We will talk in this topic about something that is not perceived by many people operating in BitMEX, where the illusion of “bigger profits” causes a relation to the usage of their offered leverage. We often observe people operating with leverage without the need to actually do so, and we will explain why:
For example, if you are a person who does not open many simultaneous operations and uses a low % of your balance to apply to each operation, do you really need to leverage? Instead of opening a 5x leverage operation using 5% of your wallet, why not use 25% of your wallet at 1x? Using 1x you pay fewer fees and this can definitely make a difference in your pocket in the long run! Do the calculations and think if you really need to open each position with leverage or you can go 1x without compromising part of your position by paying high fees.
Stop-loss on BitMEX: use it to your advantage
If you are not an experienced trader, ALWAYS use stop-market on BitMEX! Stop-limit is a great tool, but if you do not know how to properly set your stop-loss to run smoothly, you may receive a much greater loss than you thought, often as your stop loss will not be triggered if misconfigured. The stop loss is an emergency tool and should be used in this way to contain your losses and avoid disasters. Do not be afraid to use it, use the “Stop-Market” and run away from bigger problems.
A fairly frequent question among beginners on BitMEX is: Is there a way to set the stop loss before opening positions? And the answer is Yes, just set the stop-loss normally, the tip is ALWAYS to use the “Close on Trigger” option next to the stop-loss. You definitely can set up your stop-loss before placing an order to protect you against sudden spikes.
Another interesting tool available in BitMEX is the trailing stop, you can assign a gap between your position and the stop-loss, if your profit margin moves, the stop-loss automatically moves as well, using the margin configured. It is a great option to be used in scalps and also when you expect sharp and fast movements in price.
One last tip is if you are one of those people who care too much about your trades when you are in profit in an open position and with a certain margin of safety, move your stop loss to breakeven and sleep easy! This is generally a good way to act if you work with profit-taking at multiple levels. Here are two routes to follow:
a) if you can contribute the screentime and actively monitor your trades, set up the stop-loss and all targets as take profit order. In this example, we take three take profit steps. You might consider taking 50% out at take profit 1, 30% on take profit 2 and 20% on take profit 3. Once target 1 has been reached, you move your stop-loss order from the initially set price point to your entry point. This way you lock in your profits and bulletproof the trade, so you cannot lose anything anymore. On take profit target 2, you move your stop-loss to take profit 1 and so on. Warning: This requires you to watch your trades and to have the screentime to follow it.
b) if you are busy and have to work and leave your machine, it is the safest practice to set up the stop-loss and take out 90-100% at take profit target 1.
Don't trade every day… Analyze all the pairs instead!
Many people make the “mistake” of wanting to analyze trends in the global crypto market by only evaluating the movements in the bitcoin price. In fact, we should evaluate the major pairs and draw conclusions from this, the market most often moves together and analyzing more currencies your hit rate will be much higher. It is possible to perceive and anticipate reversals and also to better understand the situation of the market as a whole. While operating on BitMEX, one should evaluate the trend that prevails in all pairs and operate in favor of it, avoid betting without knowing the main trend. A clear example that you can check is the following: Near September 11, most of the pairs on BitMEX had a very clear bullish divergence in the RSI and MACD, besides defending very important medium and long-term support. In the following days, the price of Bitcoin rose about 10% and the other pairs started a beautiful race up with great possibilities of profits with big movements from 20% up to 100% (without using leverage, imagine using…). We hope you have understood the idea, analyzing more pairs, you can understand much more clearly what is happening and with this information, you will know the best moments to enter operations, without having to stay in front of the charts every hour.