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Leverage gives you the capability increase your position size by borrowing against your capital.  This can result in profits 

Leverage allows a trader to use their capital more efficiently as they can open more positions of the same size when compared to spot trading.  When spot trading, It would require you to possess $10,000 total capital if you wanted to open 10 x $1,000 positions.  When trading futures and using 10x leverage, you could open the same 10 x $1,000 Positions with only $1,000 total capital and $100 per position.  Your margin of $100 for each trade becomes $1,000 with 10x leverage. 

If you have a $1,000 position ($100 Margin and 10x leverage) and price increases by 10% from your entry price you will profit $100.  However, if the trade goes the other way and price decreases by 10% from your entry price you will lose $100 and will be liquidated.  

It is crucial that all traders who utilise leverage manage their risk correctly and always understand the sizing of their positions.  

Trading perpetual futures provides the ability to utilise leverage.  This allows you to increase your position size enabling you to use your capital more efficiently.  When spot trading, It would require you to possess $10,000 total capital if you wanted to open 10 x $1,000 positions.  When trading futures and using 10x leverage, you could open the same 10 x $1,000 Positions with only $1,000 total capital and $100 per position.

Another opportunity is the ability to short coins without having to buy the asset itself.  Having the ability to short is crucial if you want to be a successful trader, and having this ability means you can effectively profit regardless of what direction the market is trending.  

Futures also enables you to hedge your portfolio through longing or shorting.  The purpose of hedging is to offset any potential losses or gains.  This allows your portfolio to be balanced to perform well in all market conditions and to take advantage of any upside / downside moves without needing spot exposure to the asset. 

An example of where hedging can be beneficial, is if you had a position of 1 BTC in your spot holdings.  During times of uncertainty where you are not sure what way the market may trend or you are expecting some potential downside, you could open a short of 1 BTC.  This would offset any losses incurred from holding your spot position and provide extra capital to acquire BTC at a lower price.  

As the example above illustrates, you would've profited over 40% by opening a short in the region of $56,000 and closing it at $33,000.  This trade would've net you a profit of $22,400 and offset the vast majority of the loss incurred from holding your spot position. 

This also means that you can maintain your spot exposure and is especially useful if you have your holdings in cold storage where they are not easily accessible. 

There are two different margin modes you can select, “cross” or “isolated”.  “Cross” will result in all your trades sharing the same margin.  This will result in your liquidation level being lower compared to “Isolated”, however, you run the risk of 

“Isolated” results in each trade’s margin being isolated and only enables this amount to be lost if your liquidation level is reached.  Your liquidation level will be higher than “cross”, but only the margin you have allocated for each trade is at risk. Read more 

 describes how to connect your Coinrule account to Binance Futures. 

When using Binance Futures, your rules will only place limit orders. Limit orders are orders that you place on the order book, with a 

. When placing a limit order, the trade is executed when the market price reaches the limit price set or higher.  

When using Coinrule, the limit price selected is the price at the moment conditions have been met, plus the safety margin that was chosen from the settings page as shown below.

An example of this is if you have an order where the price condition for execution is at $100, if the safety range is 0.5%, the

 that is selected is 0, the limit price will be the same as the price triggered. Setting up a safety range helps 

Coinrule has now integrated support for USD amount when trading futures. This gives users the ability to choose between specifying their trades in terms of a 

 rather than relying solely on the traditional method of using the number of contracts. This aims to provide traders with more flexibility and convenience in executing their trading strategies.

2. Navigate to the Rule page and select your connected futures exchange

3. When creating or editing a rule, you will now see an option to select either "USD amount" or "Number of contracts" as the quantity type for your trades.

5. Enter the desired dollar amount you wish to allocate to the trade.

6. Coinrule will automatically calculate the corresponding number of contracts based on the current market price and contract specifications.

7. Customize your rule's conditions, actions, and any additional parameters as needed.

8. Save your rule and launch it to start trading based on the specified USD amount.

Important Tip: When closing a position, users have the option to choose from percentage (%), USD amount or contracts.

When trading futures, a contract is 1 unit of the asset you are choosing to trade.  It can also be thought as the current price of the asset.

For example, 1 contract of Ethereum is a single coin and is worth $2,000 (at current market price).  

The value of number of contracts you trade is also know as your position size.  Your position size consists of your margin multiplied by the leverage you are using.

Alternatively, you can calculate your position size by multiplying the price of the contract when you opened the position by the number of contracts you are trading. 

Position Size = Price * Number of Contracts

Your exchange uses your capital (margin) as collateral and lends you funds against this initial amount.  The amount you borrow is determined by the amount of leverage you are using. 

You can calculate the amount of margin required by using this formula :

Margin = Position Size ($ Value of Contracts you are Trading) / Amount of Leverage

Any Contract Market Scanner For Futures Trading

” market scanner to empower traders, regardless of their level of experience, to track the entire market simultaneously. By allowing traders to track the entire market simultaneously, it paves the way for more trading opportunities, while also reducing the stress and time associated with manual market monitoring. Now, traders can focus on refining their strategies and making informed decisions, knowing that the Any Contract market scanner is ceaselessly working to identify potential trades across the entire crypto market when trading futures. Read more in this 

The 'Do not buy contracts with open position' operator ensures that a rule won't purchase contracts that already have an open position.

This applies whether the position was initiated by the same rule, a different rule, or even if it was opened manually or externally.

The do not buy any contract with open position exception has been added to "Trading exceptions" in settings and enabled by default.

Do Not Buy Same Contract Twice Until Position Closed

Futures

Understanding How To Set Leverage On Futures

When Trading with leverage on Coinrule, there are several ways to set your preferred leverage. You could either set your leverage (through the formula explained below) or by setting your leverage directly on the Exchange. This article explains how to go about setting your leverage and the two different methods.

On futures, Coinrule allows you to trade one coin per rule. This is to prevent your rule opening trades on several different coins and drastically increasing your exposure to the market when using leverage.

Traders can now conveniently choose their desired leverage level, ranging from 1x to 100x, when trading on 

 rather than relying solely on the traditional method of using the number of contracts. This aims to provide traders with more flexibility and convenience in executing their trading strategies. Read more about how 

Alternatively, to set leverage using number of contracts and to figure out how many contracts you want to Long / Short, use this equation:

Position Size / Price = Number of Contracts

Using ETH as an example, If you were wanting to allocate $100 per trade you would do the calculation 100 ($100 you are allocating) / 1848 (Price of ETH) = 0.0541 Contracts.

When you use leverage this number will change as your position size will be multiplied by the amount of leverage you are using. For example, you have $100 of margin (your own capital you put up as collateral) and you use 10x leverage. 100 * 10 = $1,000 (This is your new position size).

1,000 / 1848 = 0.541 contracts as shown in the example:

: Binance Futures has recently introduced a new feature for leverage trading. This feature impacts the manner in which leverage is set for 

 futures accounts and is meant to make the process more user-friendly and convenient. 

When opening a new futures account on Binance, you'll be prompted to select a "Default Leverage" for your account. You can choose from the provided options: 5x or 20x. Alternatively, you can also opt for a custom leverage, where you can set a 10x leverage if that suits your trading style and risk appetite. The chosen default leverage will apply across 

It is important to note that this feature currently only applies to new futures accounts. Existing Binance Futures accounts are not automatically subject to these default leverage settings. If you already have a futures account with Binance, you will need to continue setting your leverage manually for each asset. 

Traders can now conveniently choose their desired leverage level, ranging from 1x to 100x, when trading futures on 

To set Leverage on Coinrule for KuCoin Futures Trading

1. Login your Coinrule account and navigate to the Rule page.

2. While creating or editing a rule for KuCoin futures, you will now find a leverage setting option.

3. Select the desired leverage level from the available options, ranging from 1x to 100x.

4. Ensure you have a clear understanding of the risks associated with higher leverage levels and trade responsibly.

5. Customize your rule's conditions, actions, and any additional parameters as required.

6. Save and launch your rule to initiate trading with the selected leverage.

Coinrule's integration of leverage setting for Binance Futures and KuCoin Futures marks another milestone in empowering traders with enhanced control and precision. By allowing users to select leverage levels directly on the Coinrule platform, traders gain the flexibility to optimize their trading strategies according to their risk tolerance and market conditions. 

Maximize your trading potential by leveraging this new feature on Coinrule today.

Happy trading and enjoy the benefits of leverage setting on KuCoin futures!

Please note that this article contains affiliate links.

An explanation of how to set leverage when trading Futures.

How To Set Leverage On Futures

In the vast world of cryptocurrency trading, it's impossible for individual traders to keep a constant eye on the entire market. The cryptocurrency landscape is ever-evolving, with thousands of tradable assets spread across multiple exchanges. Coinrule has introduced the “

” market scanner to empower traders, regardless of their level of experience, to track the entire market simultaneously. The "any contract" market scanner for futures trading is identical to "any coin" market scanner for spots trading.

With the Any Contract market scanner, you can monitor hundreds of potential trades, effectively bypassing the human limitation of tracking such a wide range of information. It seamlessly combines the power of automation with the volatility of the crypto market, delivering a trading tool that spots potential profitable trading setups across the market. 

By allowing traders to track the entire market simultaneously, it paves the way for more trading opportunities, while also reducing the stress and time associated with manual market monitoring. Now, traders can focus on refining their strategies and making informed decisions, knowing that the Any Contract market scanner is ceaselessly working to identify potential trades across the entire crypto market when trading futures.

This article will guide you through the steps needed to effectively use the Coinrule's Any Contact market scanner when trading futures:

To access the Any Coin market scanner, you need to login to your Coinrule account. If you do not have an account, you can easily sign up on the 

: Connect your Futures Exchange to Coinrule 

Once you've successfully connected your futures exchange to Coinrule, you can now create and launch a rule! See an example of a rule using the "any contract" scanner:

After creating your rule with your predefined rule conditions, launch the rule. The Any Contract market scanner will now start scanning the entire market for any contract that meets the conditions of the rule

You can now create your futures rule to scan the market for the best/worst performing coin. Read more about it 

You can now save your favorite coins as a bundle when trading futures on Coinrule. This allows users to program their rules to only operate on specific bundles of coins whilst excluding all other coins in the market. Read more 

'Any Contract' Market Scanner

when a market experiences an extended downtrend, commonly over 20%, for a period of at least two months.

 This definition is fit for traditional markets where the volatility is lower. For crypto, a 20% decline is seen as a slight dip and can be experienced over a few days without major amounts of cortisol entering your bloodstream. Typical bear markets see bitcoin retrace between 80-90% and altcoins up to 99% and usually last between 6 months and 2 years, depending on the macroeconomic environment.

Across bitcoin’s history, it is estimated to have had 42% down days, where the price closed lower than where it opened. For this reason, it is essential to understand how to profit from downtrends and not always have a bullish bias. When understood, bear markets provide the perfect opportunity to profit from selling and buying back lower - also known as short-selling. 

When analysing price during a bear market, you are keeping an eye out for where good places to sell and rebuy, with the aim is to invert the system you use during a bull market. “Buy low, sell high” becomes “Sell high, buy low”. "Long support" and "sell resistance" becomes "short resistance" and "buy support". This same philosophy can also be carried over to indicators. 

In a bull market your strategy may have been based on the 1-hour timeframe and bought when the following conditions were met: 

RSI is below 40 and near oversold territory

During a bear market, you could use the same system but invert these values and sell first instead of buying.

The conditions for this strategy then become:

Sell when RSI is above 60 and near overbought

Price has decreased by 1% within 1 hour. 

Accessing and trading futures markets enables you to short assets without having to own the underlying asset. This increases profits as it prevents you from having to hold coins that you ultimately believe will trend down - leading to the profits only mitigating losses from holding. 

Futures also provides you access to leverage where you can increase your capital efficiency and overall exposure to the market. Leverage should only be used if the implications of increasing your position size are understood. Stop losses and effective risk management should also be used to prevent substantial losses from taking place. 

Volume is another useful indicator that ensures trends are strong. It could be argued that one of the most important and fundamental indications of a breakout or breakdown is price and volume. 

There is a saying that “price follows volume”, and suggests that when a strong increase in volume is followed by an uptrend or downtrend in price, it is a clear indication of a strong trend. When this occurs during a downtrend it showcases there is true excess supply for the asset and a large quantity of selling. This opposes a low number of buying that can be overcome more easily which occurs when volume does not decrease substantially. 

Moving averages can also be used to prevent your rule from trading when the market conditions are not trending in the direction you are trading. Moving averages can act as resistances during a bear market, with an indication of a downtrend being a shorter-term moving average being below a longer-term moving average. This illustrates that the most recent price has been lower than the price further in the past, meaning a downtrend has occurred. 

Using key moving averages, such as the 100-hour, can also prevent your rules from buying or selling when the trend is against the rule setup you are using. The chart below of Ethereum showcases the increased probability of your rule not trading against the trend when you use moving averages. 

To prevent your rules that are based on longing from buying when there is a downtrend, you can set a condition to only buy if the price is above the MA 100 in a 1-hour timeframe (orange line). The inverse can be applied to rules that are focused on shorting, where coins can only be sold if the price is below the MA 100 in a 1-hour timeframe. 

The entries below showcase how you can set up your rules to follow this principle. These two rules could also be run in parallel to ensure you are profiting when the market is trending up or down. Once the MA 100 is lower than price, your rule will looks for longs. When the MA 100 is greater than price, your rule will look for shorts. 

Moving Average Trend Protection for Bullish Conditions (Long)  

Moving Average Trend Protection for Bearish Conditions (Short)

The relative strength index (RSI) is an indicator that focuses on the momentum of an asset. The RSI value ranges from 0 to 100, with a value under 30 being considered oversold and a value above 70 considered overbought. When RSI is fluctuating around the 50 value, the RSI is considered reset and the price of the asset is detailed as "fair value" for the relative timeframe. The RSI can be used as confirmation of a strong trend occurring as it measures the buying or selling pressure over the past 14 periods. 

The RSI can also be used to predict the reversal of a trend - potentially providing lucrative trade entries. If RSI is trading above 70, the price of the asset is considered overvalued relative to the previous 14 periods. This can be an area where price may encounter an overpowering amount of sellers where supply will exceed demand - causing the price to decline back to fair value. A sharp decline in RSI illustrates that the momentum of the asset has shifted, with sellers now being in control. This can also provide another confirmation that the price of an asset is reversing. The rule below aims to act on this principle. 

Another useful feature that can be used to confirm a trend or a reversal, is the “Wait For” function. This allows your rule to only proceed to buying or selling once a period of time has passed between one condition being met and another. 

Below is an example of the entry to a rule that features several confirmations that a downtrend is taking place. 

As the macro trend of the majority of asset classes is their prices increasing, due to the effects of inflation increasing asset prices, bear markets generally provide inferior profit potential compared to bull markets, when position sizing is constant. This is due to the risk-reward of shorting being lower compared to longing. For example, the potential net gain from a short can only be 100% as an asset depreciates to 0. However, the potential net gain from longing can be much higher than 100%, especially in crypto. 

If the market goes against your position when you are long with no leverage and you do not cut your losses, you have a maximum drawdown of 100% of the amount you have allocated to that trade. When you are short, with the same parameters, your potential downside is not capped and theoretically could be infinite as you miss out on the potential profit made from the asset appreciating more than 100%. 

Using bitcoin as an example, on December 15th 2018, bitcoin’s price was $3,124 and marked the bottom of the bear market. On November 10th 2021, it reached its all-time high of $68,998, providing a total appreciation of 2,108%. If you had bought $1,000 worth at the bottom and sold at its all-time high, you would have profited $21,308. Hypothetically, if you had shorted $1,000 worth of bitcoin at the same peak and held the position the same bear market low of $3,124, you would’ve profited 95.47% or $954.7. As detailed, the reward is substantially skewed towards longing.  

Another example, showcasing the increased probability of the market trending upwards, is that over the past 150 years the S&P 500 has closed 58% of its trading days higher than its opening price, compared to 42% where it closed lower. Bitcoin also has this exact same split of 58% and 42%, in favour of the higher closes. 

To summarise, profits can be made during bear markets, but with the risk-reward heavily in favour of longing compared to shorting, it is essential to utilise confirmation of a bear trend to ensure your rules do not trade whilst the market is against you.

Bear markets don't have to be feared or loathed when using Coinrule. This article explains how to trade them and what to look out for.

Trading & Shorting in Bear Markets

In the dynamic world of futures trading, margin management is crucial for controlling risk and optimizing returns. Two primary margin modes are available to traders: 

. Each mode offers distinct advantages and serves different trading strategies and risk management needs. In this article, we'll delve into the specifics of Cross-Margin and Isolated Margin and how to choose your preferred setting on Coinrule, helping you understand which option might be best suited for your trading style.

Coinrule users now have the option to choose between 

 when trading with futures. This added flexibility allows you to tailor your risk management strategies more precisely to your trading style and preferences.

Margin in futures trading refers to the collateral that traders must deposit to open and maintain positions. It acts as a safety net for brokers and exchanges to ensure that traders can cover potential losses. There are two types of margins to consider: initial margin and maintenance margin. The initial margin is the amount required to open a position, while the maintenance margin is the minimum amount that must be maintained in the account to keep the position open.

, also known as "spread margin," utilizes the entire margin balance in a trader’s account to cover potential losses. In other words, all positions share the same pool of margin, which can help in maintaining positions and avoiding liquidations during volatile market conditions.

: By pooling all available funds, Cross-Margin allows traders to use their entire balance to cover potential losses, maximizing the capital available for maintaining positions.

: During market volatility, having a larger pool of margin available can help prevent the liquidation of positions. Losses in one position can be offset by gains or available margin from other positions.

: Cross-Margin is particularly useful for traders with multiple positions as it offers more flexibility and better capital utilization.

: Since all positions share the same margin, a significant loss in one position can affect the entire account balance, potentially leading to a margin call or liquidation of other positions.

: Managing risk can be more complex with Cross-Margin, especially for traders with diverse and large portfolios.

allocates a specific amount of margin to each individual position. The margin allocated to a particular position is isolated, meaning that the potential loss is limited to the margin set aside for that position alone.

: By isolating the margin for each position, traders can limit potential losses to the allocated amount, providing better risk management.

: Each position is independent, making it easier to manage and monitor individual trades without worrying about the impact on the overall account balance.

: Traders can allocate different amounts of margin to different positions based on their confidence and risk tolerance for each trade.

: Since each position has its own margin, there is a higher risk of liquidation if the market moves against a particular trade, as it does not have access to the broader pool of funds.

: Isolated Margin can be less efficient in terms of capital utilization, as excess margin in one position cannot be used to support another.

How to Use Set Your Margin Mode on Coinrule

Select your preferred Futures Exchange e.g. Binance Futures

When setting up your trading rule, you will see the option to select either 

Choose the margin mode that best fits your risk management strategy for each trade.
 

Choosing Between Cross-Margin and Isolated Margin

The choice between Cross-Margin and Isolated Margin depends on your trading strategy, risk tolerance, and portfolio management preferences.

You have a diversified portfolio with multiple positions.

You want to maximize capital efficiency and reduce the risk of liquidation.

You are comfortable managing a pooled margin account and the associated complexities.

You prefer to limit risk on individual positions.

You want simpler risk management with independent positions.

You are trading with a high-risk strategy on specific positions and want to protect your broader account balance.

Both Cross-Margin and Isolated Margin offer unique benefits and cater to different trading needs. Understanding the differences and advantages of each can help you make more informed decisions and improve your trading performance. As always, it's essential to align your margin strategy with your overall trading goals and risk management practices.

By mastering the use of these margin modes, you can enhance your trading experience and better navigate the complexities of the futures market. 

Understanding Cross-Margin and Isolated Margin in Futures Trading

Trading With Leverage on Coinrule