watering around the edge works; sounds like you're doing it right so long as you're watering thoroughly yet infrequently; letting it dry out up to your knuckle etc.
w/r/t pot sizing, you can't hardly go wrong with some like 3 or 5 gallon fabric pots and some perlite to go with your soil 50/50. transplanting autos can be touch and go but might still be worth it once they've grown into this pot.
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