To be honest, the crypto derivatives market is like dancing on the edge of a knife. Those who dance well become gods and saints, but the cost of a misstep is immediate zeroing out. Over the years, I've seen too many people rush in with dreams of overnight riches, only to be repeatedly ground down by the market. Today, I want to share the trading bottom line I've summarized from repeated losses — it's not some guaranteed winning secret, but a survival skill to stay alive. Let me be blunt: the few who make money in derivatives are always a minority. If you want to survive longer in this market, the first lesson is to learn to "admit defeat."

**Rule 1: Stop-loss must be executed swiftly, don’t negotiate with the market psychologically**

What if you do the opposite? Cut. Do it now. Don’t expect a rebound in the next second to save you; the market is best at punishing overconfidence. My rule is simple: before opening a position, set a stop-loss point. Once triggered, even if it’s a loss to the bone, close the position and accept it.

I have a particularly vivid memory: I was bullish on BTC, just entered the market when a black swan event related to tariffs caused the price to plunge through my stop-loss. I immediately closed the position, losing 5%. At the same time, a trader who was also in but held onto hope? Half an hour later, he was liquidated to zero.

Stop-loss is never about giving up; it’s about reserving a chance to get back on the table. The most expensive cost in trading often comes from those thoughts of "wait a bit longer" and "it’s already like this, might as well hold on."

**Rule 2: After 3 consecutive losses, stop immediately — circuit breaker saves your life**

When the market is chaotic, what does it mean if you keep getting slapped down? It means your judgment is completely off. Pushing on with a stubborn attitude at this point is just feeding the market your head. I set a "circuit breaker" for myself: if I hit 3 consecutive stop-losses, I immediately close the trading app, go for a walk for half an hour, and then reassess.

Why three times? Because once your emotions are triggered, your actions become increasingly distorted. I remember during that volatile PIPPIN market, after losing two trades in a row, I was eager to recover, but on the third trade, I hit a stop-loss again. That day’s loss wiped out my entire week’s profit. Later, I realized that taking a break — walking the dog, getting some fresh air, then coming back to review the market — can make your thinking a hundred times clearer.

**Rule 3: Learn to take profits when you’re ahead**

This seems simple, but it’s where most people stumble. When your account shows floating gains, your psychology automatically raises the target. A 5% profit target becomes 10%, then 20%. What happens? The market makes a reverse gap, and your previous gains vanish, or even turn into losses.

Now, I practice taking profits in stages. Suppose I plan to earn 10% at a certain target price; I split the position into three parts. When the price hits the first level, I sell one-third to lock in gains, then do the same at subsequent levels. This way, I avoid exiting too early and missing out on further moves, while also giving myself a psychological buffer.

**Rule 4: Risk management is the foundation of trading, not a restriction**

Many think strict risk control is self-limiting, but actually, it’s the opposite. True experts don’t rely on big wins to turn things around; they accumulate small wins from each trade. Setting a maximum loss per trade, overall drawdown limits, position sizing plans — these seemingly dull routines create a protective layer between you and market chaos.

**Rule 5: Trading journal isn’t decoration, it’s your mirror**

Record every trade: why you entered, your mindset at the time, the final result, what to improve. After three months, you’ll realize you’ve repeatedly fallen into the same trap. This habit is more valuable than any trading system because it helps you gradually understand your true self.

The derivatives market is never short of new players, nor stories of being taught lessons by the market. Surviving longer and earning more steadily — that’s the real skill.