What to do if BitMEX contract is liquidated

What to do if BitMEX contract is liquidatedIntroduction

Liquidation is an essential risk management tool in futures trading. It helps to protect traders from catastrophic losses by automatically closing out positions when they reach a certain level of loss. However, liquidation can also be a traumatic experience, especially for traders who are not prepared for it.

Steps to Take if Your BitMEX Contract is Liquidated1. Stay Calm

The first thing you need to do if your BitMEX contract is liquidated is to stay calm. It is easy to panic in such situations, but panicking will only make things worse. Take a few deep breaths and try to assess the situation rationally.

2. Review Your Trading Strategy

Once you have calmed down, you should take some time to review your trading strategy. What went wrong? Did you enter the trade with a stop loss? Did you use leverage that was too high? Once you have identified the mistakes that you made, you can start to make changes to your strategy so that you can avoid similar mistakes in the future.

3. Check Your Margin Balance

After you have reviewed your trading strategy, you should check your margin balance. If you have any open positions, you may need to add more margin to keep them open. If you do not have any open positions, you can withdraw your remaining margin balance.

4. Sell Your Losing Position(s)

If you have any open positions that are losing money, you should consider selling them. The longer you hold on to a losing position, the more money you will lose.

5. Re-evaluate Your Risk Tolerance

If you are repeatedly getting liquidated, it may be a sign that you are taking on too much risk. You should re-evaluate your risk tolerance and make adjustments to your trading strategy accordingly.

6. Take a Break from Trading

If you are feeling overwhelmed, it may be helpful to take a break from trading for a few days. This will give you time to clear your head and come back to trading with a fresh perspective.

Conclusion

Liquidation is a normal part of futures trading. By following these steps, you can minimize the impact of liquidation and get back to trading as quickly as possible.