Many people suffer losses in futures trading, and the root cause is not an inability to see through the market trends, but rather a misunderstanding of the exchange's game rules. Traders who don't understand the rules often become the market's "cash machines."

Take the funding fee mechanism as an example. It is a unique balancing tool for perpetual contracts, settled every 8 hours. It seems fair but secretly harbors risks. When market sentiment is extremely bullish, the rate turns positive, and longs need to pay shorts; conversely, when the market is pessimistic, shorts pay longs. It sounds reasonable, but the real problem lies in the holding time.

A typical case: a trader correctly predicted the direction but held the position for four days, accumulating a funding fee of over $1,000. This fee directly eroded the trading account, ultimately leading to liquidation. Even more painfully, the market started rising the day after closing the position. It’s not that the market is against you, but that you can’t win the cost battle.

The key point is: if you open a long position in an environment where the rate is positive and relatively high, you are essentially carrying a continuously growing interest burden. Many traders only focus on candlestick patterns and fail to realize that this "invisible thief" comes to take a cut every 8 hours.

How to avoid this trap? First, when two consecutive funding periods have rates exceeding 0.1%, absolutely avoid opening positions against the trend. This threshold often indicates excessive market crowding. Second, control the duration of each position—don’t expect to hold for too long. The compounding effect of the rate can completely change the profit and loss landscape at a critical point.

Futures trading is like this—details often determine the final outcome.