Top 5 Mistakes Traders Make with Perpetual Swaps — And How to Avoid Them

Perpetual swaps can be a trader’s dream — or their worst nightmare.

They offer massive upside, tight spreads, deep liquidity, and no expiry. But with great power comes… well, the temptation to mess it all up.

If you’ve been trading perps on Bybit, Binance, or OKX, and find yourself wondering “Why does this keep happening to me?” — this article is for you.

Let’s break down the top 5 mistakes traders make with perpetual swaps and, more importantly, how to avoid them.

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1. Overusing Leverage Like It’s a Cheat Code

Let’s be real — leverage is seductive.

• 10x feels fine.
• 25x looks spicy.
• 100x? Let’s gooo… until your account is gone.

The truth: Leverage amplifies both gains and losses. Most traders don’t survive long enough to realize that.

💥 Why it’s a problem:

• Small moves wipe out big positions
• High leverage + low margin = liquidation city
• One bad trade can nuke your entire portfolio

✅ What to do instead:

• Use 2x–5x until you have serious consistency
• Only scale up when your risk management is airtight
• Focus on position sizing, not flexing with 50x

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2. Ignoring the Funding Rate (Until It Wrecks You)

The funding rate isn’t just a number on your screen — it’s a real cost (or passive income stream) that affects your trades over time.

🧨 Why it’s a problem:

• Holding a long in a market with 0.1% funding every 8 hours? That’s 0.3% daily bleed.
• You could be making a good trade but slowly getting drained by fees.

✅ What to do instead:

• Check funding before entering, especially for swing trades
• Avoid high positive funding unless you’re in and out quickly
• Consider trading the opposite direction when funding extremes hit

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3. Trading Against Market Structure (Because Twitter Said So)

Let’s say ETH is in a clear downtrend. You see it dip again, and you think “This is the bottom!”

So you go long.

And then it drops 5% more.

News flash: Price respects structure — not your feelings or your favorite influencer’s calls.

🚫 Why it’s a problem:

• Traders long into resistance and short into support constantly
• They ignore higher timeframe trends for “hope trades”
• One fakeout ruins their confidence (and their account)

✅ What to do instead:

• Use daily + 4H charts for bias, 15m or 5m for entries
• Trade with the trend, not against it
• Always ask: Are we trending or ranging? Then plan accordingly

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4. Revenge Trading After a Loss

You get stopped out. You’re annoyed. You immediately open another trade to “get it back.”

Sound familiar?

That’s not strategy — that’s ego.

🥵 Why it’s a problem:

• Emotional trades = no logic, no edge
• You’re more likely to oversize, ignore risk, and spiral into more losses
• It turns one small mistake into a week-long drawdown

✅ What to do instead:

• Step away after a loss — go for a walk, drink water, touch grass
• Journal what went wrong (so you don’t repeat it)
• Come back when your head is clear, not your ego is loud

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5. Holding Positions Through Volatile Events “Just to See”

Whether it’s FOMC, CPI, NFP, or a major crypto hack — holding a leveraged position into volatility is like gambling blindfolded.

🔥 Why it’s a problem:

• Spreads widen
• Wicks get crazy
• Liquidations spike
• Your stop may not even fill where you placed it

✅ What to do instead:

• Close positions before major news if you’re unsure
• Or reduce size and hedge
• Wait 15–30 mins post-event to enter new positions

Pro tip: News moves are often fakeouts. Let the market choose a direction — then follow.

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Bonus: Not Treating Trading Like a Business

If you’re trading perps seriously, you need to think like a risk manager first and a trader second.

👎 What losing traders do:

• Trade randomly
• No system
• No journal
• No accountability

✅ What winning traders do:

• Follow a defined strategy
• Track every trade
• Respect capital preservation
• Think in probabilities, not emotions

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Final Thoughts: Don’t Be the Liquidity

In the world of perpetual swaps, most traders aren’t losing because they’re “wrong” — they’re losing because they’re undisciplined.

You can avoid most of the pain in this game by:

• Using modest leverage
• Respecting market structure
• Staying emotionally in control
• Understanding how funding and liquidations work

Trade smart. Stay patient. Be the shark, not the bait.

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