How to trade Futures to Long and Short the market with Vestinda
In this comprehensive guide, we will walk you through the process of building long and short trading strategies using Vestinda's Strategy Builder. With our platform, you can now take advantage of both upward and downward price movements, enabling you to maximize your trading opportunities. Whether you're a seasoned trader or just starting out, this step-by-step tutorial will empower you to create effective strategies for long and short positions using your Futures trading account. Let's dive in!
Positions opened by Vestinda in your Futures account are always using 1x Leverage.
If you're trading Futures with us using an automated strategy, please make sure you do not make manual adjustments to your open positions. Especially, don't change Leverage for a specific asset.
IMPORTANT: If you want to use multiple trading strategies on the same Instrument both Long and Short, you must make sure your Broker/Exchange has this option available.
eg: For Binance Futures, please activate Hedge Mode for your account by following this tutorial.
What are Long and Short positions
When it comes to trading, long and short positions are two fundamental concepts.
A Long position refers to the act of buying an asset with the expectation that its value will increase over time. Traders who take a long position aim to profit from the price appreciation of the asset. In simple terms, they buy low and sell high. Long positions are commonly associated with bullish market sentiments and are used to capture upward price movements.
On the other hand, a Short position involves selling an asset that the trader does not currently own. Traders take a short position when they anticipate that the price of the asset will decline. In this scenario, the trader borrows the asset from a third party, sells it at the current market price, and aims to buy it back at a lower price in the future. The goal is to profit from the price decrease. Short positions are typically used in bearish market conditions or when traders believe that the price of the asset is overvalued.
Both long and short positions offer traders different opportunities to profit from market movements, whether they believe prices will rise or fall. It is important to understand the risks and rewards associated with each position type and to consider market conditions and analysis when making trading decisions.
What are Futures?
Futures are financial contracts that allow traders to buy or sell an asset at a predetermined price at a specified date in the future. These derivative contracts enable market participants to speculate on the future price movement of various assets, including commodities, stocks, indices, and cryptocurrencies, without the need to own the underlying asset. Futures provide traders with the opportunity to profit from both rising and falling markets by taking long or short positions.
When trading futures, a buyer and a seller enter into an agreement to exchange the underlying asset at a predetermined price (known as the futures price) on a specified future date (known as the expiration date). The standardized nature of futures contracts, including the contract size and expiration date, facilitates liquidity and ensures ease of trading. Futures contracts are traded on regulated exchanges, such as the Chicago Mercantile Exchange (CME) or Binance Futures, providing traders with a transparent and regulated marketplace. Traders can utilize futures to hedge their existing positions, speculate on price movements, or manage risk exposure in volatile markets.
Vestinda currently allows trading Perpetual futures only on Binance Exchange.
Also known as perpetual swaps, perpetual futures are a type of futures contract that is designed to mimic the spot market rather than having an expiration date. Unlike traditional futures contracts that have a fixed settlement date, perpetual futures contracts are designed to continue indefinitely. They are often used in cryptocurrency derivatives trading.
Building Long and Short strategies with Vestinda
Step 1: Learn how to use Vestinda Strategy Builder
Familiarize yourself with the Vestinda no-code Strategy Builder.
Step 2: Building Long Strategies
- Identify the indicators or signals you want to use for your long position. This could include popular indicators like Moving Averages, RSI, or MACD.
- Define the entry conditions for your long strategy, such as price crosses above a specific moving average or RSI enters oversold territory.
- Set up additional parameters, such as stop-loss levels, take-profit targets, and trailing stops, to manage your risk and maximize profits.
- Test and backtest your long strategy using historical data to evaluate its performance.
Make sure you select the Long Position Type
Step 3: Building Short Strategies
- Repeat Step 3, but this time focus on indicators and conditions that indicate potential short opportunities.
- Define the entry conditions for your short strategy, such as price crosses below a specific moving average or RSI enters overbought territory.
- Apply risk management parameters, including stop-loss and take-profit levels, to protect your positions and optimize risk-reward ratios.
- Conduct thorough testing and backtesting to assess the effectiveness of your short strategy.
Step 4: Advanced Strategy Backtesting and Optimization
- Explore advanced features in the Strategy Builder, such as adding additional indicators, implementing trailing stops, or applying custom conditions.
- Utilize backtesting and optimization tools to fine-tune your strategy parameters, ensuring optimal performance in various market conditions.
Step 5: Automating and Monitoring your Strategy
- Once you are satisfied with your long and short strategies, save and automate them on top of your live trading account.
- Monitor your positions and make necessary adjustments based on market dynamics and strategy performance.
- Regularly review and analyze the results to continuously refine and improve your strategies.
Learn more about how to:
By following these step-by-step instructions, you can leverage Vestinda's Strategy Builder to create robust long and short trading strategies. Remember, it's crucial to thoroughly test and backtest your strategies before deploying them in live trading. With Vestinda's powerful tools at your disposal, you can seize opportunities in both bullish and bearish markets, enhance your trading performance, and unlock your full potential as a trader. Start building your long and short strategies today and take your trading to new heights!
If you have any questions or need further assistance, don't hesitate to reach out to our dedicated support team or consult our extensive Helpdesk resources.
Happy trading with Vestinda!