How to use futures DCA (Martingale)?

The Martingale strategy, also known as DCA (Dollar Cost Averaging), is commonly used in forex and cryptocurrency markets. It is particularly suitable for those concerned about buying at the bottom or facing a decline after purchase. In spot DCA (Martingale), you bet on price increases to profit, while in futures DCA (Martingale), you can go long or short. If the side is wrong, you can use leverage to increase your position multiple times and sell for profit after the market corrects.

The futures DCA (Martingale) is particularly suitable for capturing rebound opportunities in volatile marketplaces and simplifies order management. If you have a strong conviction about the underlying side, you can customize the safety order parameters to double your position, compensating for losses and making a profit. This strategy is applicable in high-risk, high-reward scenarios, so please assess your risk tolerance carefully.

1. How to use the futures DCA (Martingale)?

Open the platform app and tap on [Trade] - [bot trading] - [futures DCA (Martingale)]. The platform offers two modes: [AI Strategy] and [Manual Creation]. If you choose [AI Strategy], select [Long] or [Short]. The platform will recommend different strategy cards with various styles and parameters based on the historical performance of the cryptocurrency. Click [Use] on the card, then fill in the [Leverage], [Investment Amount], whether to use profit reinvestment, and the maximum amount for automatic margin transfer to create your strategy.

You can also choose to create manually. You will need to select the side (long or short), fill in the trigger conditions, investment amount, and other parameters. Once you have set the parameters, you can create the strategy. You can view the strategies that are currently running in the "ongoing" section. If you enable automatic margin transfer, the strategy will automatically transfer margin from the trading account when the maintenance margin rate reaches a high-risk threshold, helping to avoid liquidation.

2. Frequently Asked Questions

1. What is the maximum number of creations for the Martingale system?

The maximum number of futures DCA (Martingale) you can create is currently 100. Please note that this limit may change based on platform adjustments, so refer to the displayed quantity on the page for the actual quantity you can open.

2. Why does the page display "Stop (Creation Failed)" when creating a Martingale strategy?

• If the initial order amount you set is too low and does not meet the margin required for the minimum number of contracts (which varies by trading pair), the system will stop the strategy.

• If the strategy account balance is less than the initial order amount, the creation will fail even if the minimum order quantity requirement is met.

• Insufficient margin to open a position due to not meeting the minimum order quantity requirement (the minimum order quantity varies depending on the trading pair).

• When the Markets experiences significant fluctuations, it may trigger the price limit mechanism or result in a creation failure.

3. How to manually increase your position?

Open the ongoing strategy, click on "More" and then "Add Position" to increase your investment in the ongoing strategy.

4. Why didn't the futures DCA (Martingale) trigger when the starting condition was met using the RSI indicator?

The futures DCA (Martingale) uses the RSI indicator as a starting condition, requiring 120 completed candlesticks for calculation. If the trading pair has just launched and there are not enough candlesticks, the strategy cannot be triggered.

If the corresponding number of conditions is met, you need to check the K-line period set for the RSI. For example, if the period is set to 1 hour, you must wait for all the K-lines of that 1-hour period to complete before checking if the threshold is reached. If the 1-hour K-lines are not fully completed, any conditions met during that time will not trigger.

5、Why does the newly created futures DCA (Martingale) not display the estimated liquidation price?

If your position side is long, it may be because the position margin is sufficient, and it will not trigger a liquidation even if the price drops to zero, so it does not display. If a short position is not displayed, you can contact customer support for assistance.

6. Why does the leverage level I set not match the actual leverage level displayed on the page?

The leverage level selected in the trading interface is the nominal leverage. It determines the maximum position size that can be opened and the margin required for the current position. The effective leverage displayed on the page refers to the real leverage ratio calculated based on the open position's value and the margin used, reflecting the actual risk of the position.

In futures trade, if you increase your position, the position value will rise. If the margin remains unchanged, the effective leverage will increase accordingly. This means that even if a fixed nominal leverage level is set, the effective leverage will change based on the fluctuations in the position value.

7. How is the maximum drawdown rate of the futures DCA (Martingale) strategy calculated over 7 days?

The seven-day max drawdown rate of the futures DCA (Martingale) strategy = absolute value of the max drawdown / highest net value.

8. Why does the estimated liquidation price appear higher or lower than the order price for additional margin?

The estimated liquidation price displayed on the futures DCA (Martingale) page first lists all safety orders and the initial order. It assumes each order is filled one by one and calculates the liquidation price after each order is filled. If the liquidation price exceeds the next execution price, the calculation stops. Therefore, it is normal for the estimated liquidation price to be higher or lower than the order price of the additional positions.

9. How to use profits from the profit reinvestment feature?

After enabling the profit reinvestment feature, the strategy's profits will automatically reinvest into the next cycle as margin and will not be used for increasing positions. This portion of the profit cannot be withdrawn unless the strategy is stopped.

10. Can a trader using the futures DCA (Martingale) utilize the reinvestment feature?

Currently, the strategy for futures DCA (Martingale) created by the strategy trader does not support the reinvestment feature.

11. Why was the order still canceled even though the futures DCA (Martingale) set up automatic margin transfer?

The condition for a futures DCA (Martingale) is to maintain a maintenance margin ratio of 300%. However, the conditions for risk control to cancel an order do not depend on the maintenance margin ratio. Therefore, even if you set up automatic margin transfers, your order may still be canceled by risk control.

12. When will the futures DCA (Martingale) strategy face liquidation?

The futures DCA (Martingale) strategy will create a position. If the maintenance margin rate of the position is less than or equal to 100%, it will trigger a forced liquidation.

13. Will the forced liquidation of the futures DCA (Martingale) strategy affect other positions?

The futures DCA (Martingale) strategy will only affect the positions of that strategy and will not impact other currencies or positions in your trading account.

3. Case analysis

• Trading pair: BTCUSDT perpetual swap (assuming the current price is $25,000)

• Side: long

• Leverage: 5x

• How much to increase your position: 2%

• 单次TP目标: 5%

Stage 1 - Initial order: The system creates a new DCA cycle and calculates the price of each safety order based on the predefined price step set by the customer (2%), starting from the initial order price ($25,000). For example, the safety order prices will be $24,500, $24,000, and so on. The system will also calculate the Profit price from the initial order, which will be $26,250. This will be the TP order for the 马丁格尔 strategy.

futures price

Stage 2 - Strategy operation: The strategy initially buys one BTC futures at $25,000.

If the BTC price drops by 2% to $24,500, the strategy will automatically buy another futures at the lower price point, lowering the average entry price of the two futures to $24,750.

If the price drops another 4% to $24,000, the strategy will buy one more futures, lowering the average entry price of the three futures to $24,500.

Now, if the BTC price rebounds to $26,250 and reaches your 5% TP order, the Martingale strategy will sell all three futures for a profit and then start a new round of cycles.

The futures DCA (Martingale) strategy is an effective way for customers looking to engage in high-risk, high-reward strategies to recover losses and make profits. The futures DCA (Martingale) allows traders to automatically implement this strategy in futures trading, making it easier and more efficient to execute. However, it is essential to use this strategy cautiously and set SL orders to manage risk. By using the futures DCA (Martingale), traders can leverage the Martingale strategy while minimizing potential losses.

IV. Important notes.

1. Marketplace risk warning

This strategy may lead to rapid accumulation of trading funds in the short term. If asset prices continue to decline, using a doubling trading method will significantly increase the risk of losses. Once funds are exhausted and forced to flatten, it can result in substantial losses. Please note that the risk-reward ratio of this strategy may not align with the risk preferences of all investors. Additionally, while it is possible to recover after consecutive losses, if the asset value drops to zero, it will result in a total loss of principal. Investors are advised to thoroughly assess risks and implement strict risk management measures, such as setting SL orders to control potential losses.

2. High leverage risk warning

High leverage can amplify profits when the market is favorable, but it can also accelerate losses if the market reverses. Investors should use leverage cautiously and fully understand its potential risks. The platform reserves the right to enforce liquidation in specific situations to manage risk exposure. Please ensure you assess your risk tolerance before trading and allocate leverage appropriately to avoid unnecessary losses due to market fluctuations.

3. Explanation of forced liquidation risk.

High margin trading can quickly deplete your margin during significant market fluctuations. If your account balance falls below the maintenance margin requirement, the platform will liquidate your positions to prevent further losses, which may result in a total loss of your principal. To reduce risk, investors should fully understand the contract trading rules and develop effective risk management strategies, such as setting stop-loss orders and monitoring their account status in real-time to avoid liquidation.