Topic: Is this also your strategy to avoid hitting your stop loss early? - page 2. (Read 449 times)

A stop loss is used in leverage trading such as futures, they are designed to stop you from sustaining heavy losses by setting an exit point for a trade that goes in the wrong direction for you. This is a measure to prevent your position from being liquidated. Best to avoid leverage trading though if you don’t know what you’re doing as it’s easy to get completely wiped out in a single pump or dump. If you do ever get involved in futures trading, ALWAYS set a stop loss.

This is true. If you just open another position to increase the size of your position, the liquidation price will still gonna be the same but only the entry price will adjust base on the average of all the price entry that he made in proportion to the size. Increasing the margin is what makes the liquidity price create space but it will not gonna change the initial size of the investment yet the additional margin will be lose once the new liquidation price will hit.

it is definitely a strategy but generally depend on individuals interest. Your assets and experience address how much risk you can carry. Particularly those who are novice in the trading site they should reduce margin as much as possible and set stop loss so that they can survive in the platform.

Interesting. I need more info from you on Gunbot. I used to read about it a lot earlier but somehow I dropped the idea as it needs proper settings and if we are having set up in wrong way then things could really turn upside down. Though I had this trial earlier I might just start it over again with detailed info. Im not sure but I am hearing a lot about bot trading these days out of know where. Lolz. I might ask you @crwth in pm.

Well as far as stop loss is considered it is close thing to automation but you still need to keep focus on your trades otherwise trouble trouble! Thats why the bot comes in picture for safer and longer trades. 

Actually it is better to have a start with this method if you're a beginner, firstly it help to cut loss and thereby reducing the extent at which you may loose your coins, but why some people choose this method probably is to participate on many Leverage positions within a day or short period of time, they are the the scalding and sometimes swing traders, but i think the best advice here is for you to discover your own best trading strategies.

For me before placing an order i would like to see some retest first or a sign that my prediction is accurate in a particular trend to assure that my stop loss would not be hit afterward. Because to be honest its always happened to before when I'm scared to don't miss the right time ro enter, but always hitting my stop loss and end lose. so i made an adjustment..

This means that if you want to do stop loss in there, you need to arrange it according to the whole leverage level. If you are going to lose it all with just 1% drop then make it a quicker and closer thing, like 0.5% for example, or if you are going to lose it all with 5% then you could do it 3% for example.

I still think that if you are in high leverage situation then you would probably not need a stop loss, that is a better thing in spot trading if you ask me. Because in the leverage trading, specially in the high levels like 100x for example, it is obvious that you are risking all of the investment in return of making a decent return in quicker time hence scalping kind of very short term trading is advisable to avoid encountering stoploss situations.

The stop loss cannot depend on the size of the leverage. But the leverage is directly related to the order liquidation price. Accordingly, the higher the leverage, the closer the liquidation level is and the higher the chance of losing your deposit.

Honestly, you just end up losing more rather than protecting it.
I suggest not to follow that strategy, it wasn't helping you anymore. You'd better set your low margin and low leverage not far from the liquidation price for this it helps you easily cut the losses once the price fall.
https://blog.tokenomy.com/education-tutorial-eng/what-is-stop-loss-in-crypto-trading/

But I suggest trying to communicate your trade, making some discoveries helps you understand the impact of the STOP-LOSS strategy.

If you are speaking about the future trading.Then you need to do low leverage and low margin.And you should keep the liquidation with high volume.Because only the liquidity will save you from the full loss.When the price of invested coin will further decreased,you should do of the adding of the liquidity again.You should do this till the full amount of the investment is recovered.

Your choice! Just make out some adjustment whenever you do see that it could really be trigger out easily because this had been the main problem when you do make out some SL's too shallow.
Even if you arent dealing with high leverage or margin but still volatility could really make things even more worst if you dont really make yourself that aware on how thing works.
Just see for yourself and made out appropriate actions depending if it does work or not.Its a matter of trial and error imho.

Personally I have always thought that only a selected few should use leverage at all and the rest should simply avoid it as the risk that you lose it all raises exponentially the more leverage you use.

Since even a low amount of leverage like 3x and 4x can be more than enough to destroy your account relatively quickly, now some may argue that a stop loss can be more than enough to save them, but we know that when there is a high level of volatility in the market slippage can be enormous, so even with a stop loss your losses can be way higher than what you thought and they can be more than enough to erase almost all the profits you got during a bull market.

If you're not fond of leveraging.

You better stay on spot trading but I get the idea of being used to it if you're not going to try it. Just stay with the spot market if you're not yet prepared for it.

But if you're like testing then test out with low leverage with an amount that you're totally fine if you don't know when you'll be liquidated.

If you are bad with spot trading, you should never touch leverage, margin trading or future trading.

I don't understand what you mean. Avoid hitting your stop loss early, what does it mean? Stop loss is a tool to protect your capital in case of downward movement. It does not mean all times your stop loss order filled, price will fall deeper. Sometimes, price will turn oppositely after hitting stop loss price. It can be a dead cat bounce or a real recovery but don't worry about it. Because protect your capital is more important than gambling and see it goes away by market massacre.

I agree with you. Don't put yourself in a position that we don't understand so that it won't give us trouble. Trading in the spot market can provide an opportunity for profit if you don't understand how to trade futures. You don't need to take bigger risks like in futures trading, and you have to wait for the price to go up and down to enter the market. If you have successfully bought the coins, you just have to wait until the price increases and sell your coins.

I believe it will always be possible to change your leverage or even add more to your positions if you are really positive.
But for me, I am not a fan of this strategy.
Before I enter to trade, I plan all things, fixed position size, fixed price entry, fixed take profits price or partial take profits price.
If it will not matter at all to you, you can always adjust your position size or leverage anytime especially if you are confident.

It is best not to be greedy, the cause of loss.

Assuming you use 1x margin and the market price direction favors you, then you increase your margin to 2x after making some profit already, if the market price go against the position opened, remember the price will be closer when you will start to lose. This is not a good strategy. It would be better to just close the position and take profit with you or still leave the position opened if your analyses predict the market to still go further in your direction taken.

Some experts can though start from 1x margin, if the market favors them early, they close the market and make profit, but if the market did not favor them at first, they know they have a far range liquidation price which seem impossible to happen, they can increase the margin to 2x after the market has not favor them to certain price so that if the market later go in the direction taken, the price to when they will be making profit will get nearer to the market price. So some people can be 3x leverage traders, but because of disappointment that may first occur, they can start from 1x so if the market do not favor them at first and they predict correction to happen, they can increase the margin from 1x to 3x. But this is very risky and should be done by experts.

If you are going to use lower leverage and afraid of liquidation price why not stay in spot market? It is much safer than the futures trading but don't get me wrong they are both risky but trading with leverage is like multiplying the risk you can get.

And I agree with @Zackgeno96 I don't think you can call that as a strategy.

Understand this that low margin and low leverage are not the same thing with stop loss so they function differently. If you have chosen a low leverage to trade with it means you don't want to take alot of risk on your account, that you don't want to carry too much trade in your account at the same time and this will also reflect in your margin level when your account is burning down or increasing. Stoploss is to avoid you from losing beyond a certain limit. You set your stoploss yourself and the exchange provide leverage for you to choose from.

I don't think you can consider that as a strategy and lowering and increasing your leverage is not strategy either it was just increasing risk and lowering risk for me so I don't think it is strategy.