Seeing so many liquidations in the contract market, the root cause is actually one thing—people haven't truly understood what’s behind leverage.

Many think that 5x leverage is very safe. But do the math and you'll see: with $10,000 in your account, your maximum tolerable loss is $500, yet you open a position of $30,000. This looks like 5x leverage, but the actual risk factor has skyrocketed to 60x. Most people don't realize this at all and still boast about their risk control skills.

Those who truly thrive in the contract market treat it as a risk hedging tool. In other words, other people's liquidation chips are their profit sources. How do they do it? They spend 70% of their trading time waiting, never touching the market when the trend is unclear. When they do act, it’s like pulling a bowstring to the limit—direction is clear, and execution is extremely strict.

To survive in this market, there are really only two words: against human nature.

When others are too scared to move, you stay calm; when others are rushing to chase gains, you stay cautious. Stop-losses are never soft, keeping losses within 5%. Conversely, if you profit, you must give your profits enough room to run, with take-profit settings not lower than twice the stop-loss.

Some say contracts are just gambling, and that’s half right. If you frequently get liquidated, you are indeed gambling—relying on intuition, luck, and mood. Those who make steady money rely on probability calculations and risk management.

Compared to watching candlestick charts and doing technical analysis, discipline and patience are the true moat.