My experiences trading on BitMEX
I found BitMEX purely through Google. I was looking for a place to leverage trade my Bitcoin and, particularly, to find a way to hedge it during times of reversals or bear markets.
BitMEX is easy to sign up for (Australian resident), access and relatively easy to use. At first it looked real intimidating, but I got the hang of it after clicking around and exploring and taking the time to understand all the tools and how they would help me protect my money.
I closed my first trade after 5 minutes
Putting your money down is a real daunting process. This is money I went to work and worked hard for. It cost me hours to put these dollars together, and I knew they could vanish in the blink of an eye. Bitcoin was extremely volatile, even at the time I was making this first trade (mid-October, when it was about 5600). I kept it open for 5 minutes and closed it at a 10 dollar gain. I think I had 100 contracts using 10x leverage.
It wasn't long until I was opening some irresponsibly large positions with little to no understanding of what was going on. I got lucky the first two times, but then the market began to bite back and I experienced the reality that was leverage trading.
What I've seen since then
Since then, over the past two months I've watched Bitcoin rise to 6k, 7k, moon to 7.9k after the cancellation of Segwit2x, the reversal to 5.4k and then the gradual rise to 10k and then the explosion to 17k.
I didn't really make money on any of those moves, largely because I wasn't able to identify the signals that a movement was about to occur or because of black swan events which compromised my confidence.** Despite how it may seem, it is not easy to make gains, and you are at risk no matter what leverage you use**. The market will always trick you and make you feel secure or confident that it will do something, and then go and do the complete opposite. Be very wary when trading with leverage!
Some tips I learned about using BitMEX:
USE STOPLOSSES AND TRAILING STOPS. If the price starts moving against you, start looking for an exit. Yes, it can recover, but your optimism and confidence have zero influence on the price. When you're up, don't get greedy and try to take more. Decide for yourself how much of a profit you consider fair and reasonable, and take profit frequently.
BitMEX gets the index price for Bitcoin from both Bitstamp and GDAX. It is generally always a couple hundred dollars higher than Bitfinex, but during the bullrun to 17k was trading anywhere up to 1k higher.
Do not use 100x leverage unless you are happy to lose the money you're trading with. 100x only requires a 1% move to margin call you.
BitMEX experiences alot of lag during times of heavy volume and movement, and there are times in which the system will not accept your trades. Be very careful trading without stops during these times. It is very easy to lose your position or even worse, be liquidated without you ever realizing it.
The funding fees! They can get quite high if your positions are large. Remember, they're not based on how much bitcoin you have in equity but the size of the position you're undertaking. If you trade 0.1BTC at 10x, then your funding rate will be calculated for 1BTC! Funding is determined by the number of longs vs the number of shorts at the funding time. Whichever is greater pays the funding rate out of their equity to whichever is smaller. The maximum funding rate is 0.375%.
Don't try to take advantage of the funding to try and make gains. If you can see that the next funding rate is from longs to shorts, don't think it'll be as easy as opening a massive 100x short a second before the funding occurs and closing it a second after. The system will likely lag, and there will be movement, and it will likely be against you. Even if you closed your position a second later, you will have lost more than the funding paid you, resulting in a net loss. I speak from experience!
It costs a bit to take your Bitcoin out, so bear that in mind before you do!
These are a few of the things I've learned in my 2 months trading on BitMEX. The platform is user-friendly, safe and reliable to use and is run by a supportive and strong team. There is usually always a mod over in the trollbox who can answer your questions if you have any.
Safe trading!