U How to trade contracts on Upbit

A Comprehensive Guide to Contract Trading on Upbit

Contract trading involves speculating on future price movements of an underlying asset without directly owning it. Upbit, one of the leading cryptocurrency exchanges, offers robust contract trading services, enabling traders to amplify their profits through leverage. This comprehensive guide provides a step-by-step approach to contract trading on Upbit, delving into the essential aspects of the platform and trading strategies.

Step 1: Setting Up an Upbit Account

Before venturing into contract trading, you must establish an account on Upbit. Visit the official Upbit website (https://upbit.com) and click on the "Sign Up" button. Follow the on-screen instructions to create an account, providing your personal information, email address, and phone number. Once your account is created, complete the Know-Your-Customer (KYC) process to unlock the full range of trading features.

Step 2: Funding Your Account

Once your account is verified, you need to fund it with sufficient funds to initiate contract trades. Upbit supports multiple deposit methods, including bank transfer, cryptocurrency transfer, and credit or debit card. Select the preferred method and follow the instructions to deposit the desired amount. The minimum deposit amount varies depending on the payment method used.

Step 3: Understanding Contract Trading on Upbit

Upbit offers a wide range of perpetual contracts, allowing traders to bet on the future price movements of various cryptocurrencies, including Bitcoin (BTC), Ethereum (ETH), and many others. Each contract represents a specific amount of the underlying asset, and traders can choose to go long (buy) or short (sell) based on their market outlook.

Step 4: Choosing a Trading Strategy

There are various trading strategies tailored to contract trading, each with its own unique approach. Some popular strategies include:

• Trend Following: Identifying and trading in the direction of the prevailing market trend.
• Scalping: Taking numerous small profits by repeatedly buying and selling contracts over a short period.
• Range Trading: Trading within a defined range or channel where the price has been fluctuating.

Step 5: Placing an Order

To place an order on Upbit, navigate to the "Contracts" section of the platform. Choose the desired trading pair and select the order type. Upbit offers various order types, including:

• Market Order: Executes the order at the current market price.
• Limit Order: Executes the order only when the price reaches a specified limit.
• Stop Order: A contingent order that gets triggered when the price reaches a certain level.

Step 6: Risk Management

Contract trading involves substantial risks, and effective risk management is crucial to protect your capital. Consider the following measures:

• Leverage Management: Contracts are traded on margin, allowing traders to amplify their profits. However, leverage is a double-edged sword and can magnify both gains and losses. Use leverage cautiously and only to the extent you can afford.
• Stop-Loss Orders: Set stop-loss orders to automatically close positions when prices move against you, limiting potential losses.
• Proper Position Sizing: Determine the appropriate contract size relative to your account balance and risk tolerance. Avoid overtrading and risking more than you can afford to lose.

Step 7: Monitoring and Adjusting Positions

Once you have placed your orders, continuously monitor your positions and make adjustments as needed. Upbit provides real-time