You wake up and put the water to boil for your coffee. You start your PC and login to your Bitmex account only to find that your position has been kindly closed for you.
I got liquidated.
They also sent me an email to remind me of the process:
When opening leveraged positions, users are required to hold a minimum % of the position's equity. This is called the Maintenance Margin requirement. Your position breached its requirement of 0.5% and thus was liquidated at the market.
In other words, I got greedy, leveraged too much, didn't put any stop loss and got my account wiped out.
Now the point of my post is not to cry to the reader, but rather to explain how you can avoid this.
Using leverage to your advantage
Never use more than 25x leverage because the MMR(Maintenance Margin Requirement) at high leverage stacks the statistical odds against you making a winning trade. The MMR is the difference between the Liquidation and Bankruptcy Prices. Don’t worry about this issue at low leverage.
Stop loss orders
New investors should use only stop market orders. Stop market orders once triggered will sell at the current market price. Stop limit orders are advanced and are more prone to failure especially in markets with high volatility like cryptocurrencies.
Anyway I hope this post will help you avoid the awful feeling that is getting liquidated. Untill next time !