How To trade Bitcoin Futures with Margin on Deribit Platform

Updated: 23 February, 2022 seen 27

I've been using the Deribit crypto trading platform for years, mostly for trading options, but just recently I decided to give it a try to Bitcoin Futures with leverage. 

Deribit is a Panama-based futures and options trading platform that lists derivatives priced in U.S. dollars for bitcoin and Ether underlying products.

Deribit offers derivatives products for bitcoin and Ether. They are cash-settled, not physically-settled derivatives of cryptocurrency, so they are paid out in USD. Their maximum allowed position is $10,000,000 worth of bitcoin, or $5,000,000 worth of Ether. Fees follow the maker-taker pricing model, which gives rebates to market makers and charges fees to customers (takers). 

I decided to give  a try to Bitcoin futures trading and after watching a few YouTube videos, started by setting up my trading chart using EMA 10/ EMA 20 crossovers, additionally using EMA 200 to confirm the market trend (bullish/bearish) and MACD indicator.

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For the day trading and scalping, I prefer 1-min / 5-min candle charts, but for longer trades, I would go with a 1-hour or 4-hour candle charts. I

Disclosure:  This article contains affiliate links to the deribit.com bitcoin futures trading website, by clicking on links on this page and by investing with deribit, I will earn affiliate income at no cost to you. Also, I'm not a financial advisor and I don't give you any advice, I'm just sharing my own experience. Investments in stocks, funds, bonds, or cryptos are risk investments and you could lose some or all of your money. Do your due diligence before investing in any kind of asset. 

5 min candle charts or The 5-minute trading strategy

This strategy seems to be popular among forex traders but can be applied to the crypto as well

5-min candle size trading strategy using EMA 20 + MACD
5-min candle size trading strategy using EMA 20 + MACD

In the above chart I'm using EMA 20 chart - anything above the yellow line - bullish, anything under the yellow line - bearish, meaning this strategy might give an advantage if using in conjunction with other trading signals, like MACD.

Here is the longer exmpalantion

The 5-Minute Momo looks for a momentum or "momo" burst on very short-term (5-minute) charts. First, traders lay on two technical indicators that are available with many charting software packages and platforms: the 20-period exponential moving average (EMA) and moving average convergence divergence (MACD). EMA is chosen over the simple moving average because it places higher weight on recent movements, which is needed for fast momentum trades.

Rules for a Long Trade

  • Look for Bitcoin trading below the 20-period EMA and MACD to be in negative territory.
  • Wait for price to cross above the 20-period EMA, then make sure that MACD is either in the process of crossing from negative to positive or has crossed into positive territory within the last 25 minutes (five bars or less on a 5-minute chart).
  • Go long 0.1% pips above the 20-period EMA.
  • For an aggressive trade, place a stop at the swing low on the 5-minute chart. For a conservative trade, place a stop 0.2% pips below the 20-period EMA.
  • Sell half of the position at entry plus the amount risked; move the stop on the second half to breakeven.
  • Trail the stop by breakeven or the 20-period EMA minus 15 pips, whichever is higher.

Rules for a Short Trade

  • Look for the Bitcoin to be trading above the 20-period EMA and MACD to be positive.
  • Wait for the price to cross below the 20-period EMA; make sure that MACD is either in the process of crossing from positive to negative or crossed into negative territory no longer than five bars ago.
  • Go short 10 pips below the 20-period EMA.
  • For an aggressive trade, place stop at the swing high on a 5-minute chart. For a conservative trade, place the stop 20 pips above 20-period EMA
  • Buy back half of the position at the entry price minus the amount risked and move the stop on the second half to breakeven.
  • Trail the stop by either the breakeven or 20-period EMA plus 15 pips, whichever is lower.

EMA crossovers 9/14/21/55

Another popular and quite effective trading strategy seems is Using 4 Moving averages on one chart, I prefer this trading strategy on 1-min / 3-min /5 min and 1-hour candle sizes

Trading Bitcoin using EMA 9/14/21/55 crossovers
Trading Bitcoin using EMA 9/14/21/55 crossovers

The four exponential moving average crossover strategy is an approach to trading that uses 4 exponential moving averages of various lengths.

All moving averages are lagging technical indicators however when used correctly, can help frame the market for a trader.

Using moving averages, instead of buying and selling at any location on the chart, can have traders zoning in on a particular chart location.

From there, traders can use various simple price action patterns to decide on a trading opportunity.

If you would like to hear more about my Bitcoin Futures trading, check out my YouTube video

Signup for Bitcoin Futures at Deribit here (Affiliate link)