How to play perpetual contract at KuCoin

KuCoin's perpetual contract trading offers traders a leveraged and versatile instrument to capitalize on market fluctuations in the cryptocurrency market.

Nov 11, 2024 at 08:10 am

How to Play Perpetual Contract Trading at KuCoin: A Comprehensive Guide

Perpetual contract trading has gained significant traction in the cryptocurrency market due to its potential for profit and leverage it offers. KuCoin, one of the leading cryptocurrency exchanges, has emerged as a popular platform for traders seeking to engage in perpetual contract trading. This comprehensive guide will provide a step-by-step walkthrough of how to play perpetual contract trading at KuCoin, enabling you to harness the full capabilities of this trading instrument.

1. Familiarize Yourself with Perpetual Contracts

Before venturing into the world of perpetual contracts on KuCoin, it's essential to understand the fundamentals of this trading instrument. Perpetual contracts, also known as perp or futures contracts, are agreements that obligate the buyer to purchase an underlying asset, such as a cryptocurrency, at a predetermined price on a future date, while the seller agrees to deliver the asset at that time. Unlike traditional futures contracts that have an expiration date, perpetual contracts extend indefinitely, allowing traders to hold positions for extended durations.

2. Navigating KuCoin's Perpetual Contracts Platform

a) Accessing the Perpetual Trading Page: To commence your perpetual contract trading journey on KuCoin, navigate to the platform's homepage and click on "Futures" from the top menu bar. Subsequently, select "Perpetual" to access the perpetual contracts trading page.

b) Understanding the Trading Interface: The perpetual contract trading interface consists of several key sections:

• Order Form: This section allows you to place buy and sell orders, specifying the parameters such as quantity, leverage, and order type.
• Market Depth: Displays the current bid and ask prices, along with the corresponding order volumes.
• Chart: Provides a real-time representation of the price movements of the underlying asset.
• Trade History: Records a log of your executed trades, including order details and prices.

3. Funding and Account Management

a) Depositing Funds: To commence trading perpetual contracts on KuCoin, you must fund your account with sufficient funds. KuCoin supports a wide range of funding methods, including credit/debit cards, bank transfers, and various cryptocurrencies.

b) Selecting the Margin Mode: KuCoin offers two margin modes for perpetual contract trading: Cross Margin and Isolated Margin. Cross Margin utilizes your entire KuCoin account balance as collateral, whereas Isolated Margin allocates a specific amount of funds for each individual position.

4. Placing Orders and Managing Positions

a) Limit Order: A limit order is placed at a predefined price, either above the current market price for a buy order or below the market price for a sell order. This order only executes when the market price reaches your specified trigger price.

b) Market Order: A market order executes immediately at the best available market price. This order type is suitable for traders seeking to enter or exit positions quickly.

c) Stop-Limit Order: This type of order combines a stop order, which triggers when the market price reaches a certain level, with a limit order, which determines the execution price.

d) Managing Positions: To adjust or close positions, navigate to the "Positions" tab on the perpetual contracts trading page. Here, you can modify leverage, take profit, and stop loss orders to manage your risk and optimize your positions.