Topic: Stop Loss, A life saver or a evil? - page 2. (Read 4311 times)
I am just starting to study cryptocurrency trading and visit various resources where there are similar manuals for novice traders. But the fact is that I have never met such a resource, which would say that Stop loss is bad. every time I read information about this, then all the authors of the information provided say that stop loss is a fuse for any trader who will not let you go broke. Of course, trading is primarily the adherence to certain rules, the experience and the ability to do the right analysis, and with a calm cryptocurrency market, all this works together, if the trader really understands what he is doing. although you need to consider that a trader can work for the long term or engage in daily trading, because this has its own characteristics. but as I understand it, stop loss will bring results With the right settings, especially when unpredictable situations arise on the market. thus, stop loss is not an opportunity for constant use, but functions are triggered in emergency situations so as not to reset your account.
Hello,
I had this question in mind, since many of my trades with an adjusted stop loss got triggered, but then the market goes in the direction I wanted, but since it got triggered basically im out. I know this is due to big fishes messing around.
What do you guys think, is stop loss something or, or not so good?
I had this question in mind, since many of my trades with an adjusted stop loss got triggered, but then the market goes in the direction I wanted, but since it got triggered basically im out. I know this is due to big fishes messing around.
What do you guys think, is stop loss something or, or not so good?
The use of stop loss is a very important life-saving tool that users who use in daily or very short terms should definitely use it. Although it is a remorse because it is used in some cases, it is necessary to know that it has many benefits especially in bad market conditions. To give a short example on my own transactions, I had a 4000 USD fund liqudate by not using stop loss 2 weeks ago. Although this is a very painful experience for me, losing this money, which I previously earned by using stop loss, did not affect me financially. If I had used stop loss, that money would continue to be in my wallet with a maximum loss of 200-300 USD, and perhaps I would have been able to cover it with other transactions. For this reason, I attach great importance to the use of stop loss and I think it is necessary. Of course, short-term price movements and some needle movements on the graphics will close with stop loss positions, but you can be sure that instead of losing all the balance in your wallet, losing a small percentage of your wallet balance will hurt much less.
Exactly what it should be like, it is all depending on strategy and market and how your strategy fares with the market. There is no guaranteed way to use stop loss to make more profits, that has never been a thing before and it is not a thing now neither.
Sometimes you make a stop loss to a point and price hits "just" under that makes your coins sold and then goes up really height, for example if you had stop loss at 6k yesterday, it was around 6.7k and dropped under 6k but now above it again, which means your stop loss would have been wrong. However if you had stop loss at 7k before all of this started, you would be in profit.
So, basically strategy+market+luck= profit but strategy+market+unlucky= loss. That is all there is to it, there is no 100% way to use it.
Sometimes you make a stop loss to a point and price hits "just" under that makes your coins sold and then goes up really height, for example if you had stop loss at 6k yesterday, it was around 6.7k and dropped under 6k but now above it again, which means your stop loss would have been wrong. However if you had stop loss at 7k before all of this started, you would be in profit.
So, basically strategy+market+luck= profit but strategy+market+unlucky= loss. That is all there is to it, there is no 100% way to use it.
Right now if you look at what happened we could easily say that it was a life saver, however just because this fall was there doesn't mean it was always a life saver. In a situation where stop loss is a thing and pandemic happens when price was 7.5k and you put a stop loss at 7k, you are lucky, you can now buy back from 5k and you would be doing better actually, that is the good stop loss and we love that version.
However, maybe you put it at 3.8k so that you wouldn't be affected if a doomsday type of thing happens and price goes under 3k, well unfortunately for you you have just sold your coins for 3.8k and price is above 5k, that is the bad version of stop loss and we hate that version. So stop loss could be a bliss or could be a curse, all depends on how you use it.
However, maybe you put it at 3.8k so that you wouldn't be affected if a doomsday type of thing happens and price goes under 3k, well unfortunately for you you have just sold your coins for 3.8k and price is above 5k, that is the bad version of stop loss and we hate that version. So stop loss could be a bliss or could be a curse, all depends on how you use it.
Well, actually, a lot depends on the strategy, because really now there are strategies that can lead to profits and good results, even if you trade without stop loss, the main thing is to correctly navigate the approaches and understand whether to take risks in a particular situation. Unfortunately, people often can not critically assess the situation and just blindly follow the standard excursions, without paying attention to the market situation and its peculiarities. And now it is more sad, I think that this is what gives traders the false impression. And in general, I think that this is what suits every single person, only it matters. I am in favor of everyone trading in a comfortable way, it is not always worth sticking to the opinion of the majority in everything.
It depends on when stop loss is going to be a life saver. For example, when you are using stop loss in a roller coaster ride with the price then, you are using it in a wrong way! The market will have huge ups and down and stop loss will make your comeback not possible. I usually use stop loss when the market is pretty stable so that, when there's gonna be a huge dump out of nowhere I will be saved. Another thing is, when you are doing leverage trading always use stop loss, no matter how the market is doing, avoid being liquidated, hahaha.
I think that stop loss is exactly what can insure you in the most difficult situation, because otherwise you will have to constantly monitor the situation in the market and it will take all my free time, I do not think it can be considered profitable. I think it's this feature that saved a lot of capital. It's another thing when you're doing calculations by eye and you just can't control how it should be. I think that's what causes a lot of losses, because you just have to calculate take-profit and stop-loss correctly, because that's what allows you to think about the risks and secure your profits. But I certainly wouldn't trade without stop loss, it's a road to nowhere...
Stop loss make us confused will our assets back to higher price or not, but in other time we must ready when holding coin price suddenly dump without get anything from our investment way, but if can recovery for lost better to make chance and cut lost for looking profit with other coins.
But more than anything, stop loss gives day traders the assurance that they needed and they are wanting. Without stop loss you just wouldn't know when to stop. You'd be stuck in a coin with no hopes of getting an increase or you will get stuck in a losing coin. You would want to have stop loss in your portfolio or investment strategy as it provides you security. It allows you to jump from one coin to another with minimal losses, and most of all, it provides you the freedom to choose which coin you wanted to jump in. So I don't really see anything confusing about it after it's just a simple rule of thump. 
Stop loss make us confused will our assets back to higher price or not, but in other time we must ready when holding coin price suddenly dump without get anything from our investment way, but if can recovery for lost better to make chance and cut lost for looking profit with other coins.
Stop loss function is not confusing, people use it in just few cases, to sell and wait for price to dip more and then buy (popular shorting), or selling and moving money in some other alt. With ethereum and bitcoin I never use stop loss function, I simply wait if I buy in wrong moment, sooner or later the price of these two coins bounce back. For me stop loss function is good for risky investments in some alts, mostly low valued alts, where alts that break support can drop really hard, even to 1 sat. With them stop loss is almost necessary if you don't wish to end up with total loss.
Stop loss make us confused will our assets back to higher price or not, but in other time we must ready when holding coin price suddenly dump without get anything from our investment way, but if can recovery for lost better to make chance and cut lost for looking profit with other coins.
I rarely use stop losses especially when im invested in Bitcoin, basically what im doing is buying in the dips and only sell if Bitcoin goes new all time high. You could say im a long term type of trader that's why, i dont worry if ever the price plunge cause i know it will eventually return. Long term trading for me is where the profits are.
All the same, there is a sense. If you bought Bitcoin at the bottom, then I do not think that you want to lose your money in case of unforeseen circumstances, such as a second bottom.
Therefore, it is always better to play it safe and keep your finger on the pulse. A cataclysm may happen or something else that lowers the price of bitcoin very low. You must be prepared for this.
I rarely use stop losses especially when im invested in Bitcoin, basically what im doing is buying in the dips and only sell if Bitcoin goes new all time high. You could say im a long term type of trader that's why, i dont worry if ever the price plunge cause i know it will eventually return. Long term trading for me is where the profits are.
All the same, there is a sense. If you bought Bitcoin at the bottom, then I do not think that you want to lose your money in case of unforeseen circumstances, such as a second bottom.
Therefore, it is always better to play it safe and keep your finger on the pulse. A cataclysm may happen or something else that lowers the price of bitcoin very low. You must be prepared for this.
Stop-loss is an important action for trading if you do not want to experience a large loss, when the altcoin that you handle touches the stop loss then there you must buy back at a lower price if you still believe that altcoin will recover.
I rarely use stop losses especially when im invested in Bitcoin, basically what im doing is buying in the dips and only sell if Bitcoin goes new all time high. You could say im a long term type of trader that's why, i dont worry if ever the price plunge cause i know it will eventually return. Long term trading for me is where the profits are.
- I know for investors who have chosen bitcoin and hold it in the long term, patience is the inspiration for their infinite profits, price in the short term is not their concern but this method seems to be quite obstinate and lacks a necessary analysis in the market with such fluctuations and opportunities. This market needs us to be proactive, rather than passive when it is not so easy to guess, so stop loss is always a safe contract for us, this guarantee can sometimes make us miss or uncomfortable but in certain times it will prove its worth. 
stop loss is very helpful for traders to prevent large losses, and can make traders not panic when market dump because stop loss will save your money when market dump
You will think you are lucky with stop loss only when the spike is continual. But once it is a spike that reverts or reverses after hitting your SL then you will beat yourself up for using a SL. There is a disadvantage in using it more than the advantage. Like someone said here it's better to reduce the stake money and let it run than using a SL. I strongly recommend that every crypto trading must use stop loss, because crypto prices are very volatile so if you don't use stop loss we will
experience running out of capital, which is likely to cause prices to continue to fall. For me personally the stop loss is a life saver,because I've
experienced escaping several times from the losses I experienced thanks to using stop loss. Indeed, we have to manage our capital if you want
to use stop loss optimally, so that after we do stop loss, we can re-enter the market by buying more coins at a cheaper price.
Having a much better understanding in regards to stop and loss features for your trading activities is very important, there are some incidents where you position yourself and your target did not materialized and instead moves in the other side, having a good stop and loss settings you'll be able to catch your position without monitoring it 24/7 it will also prevents you to make a higher damage as long as you know how to set it properly it will be a helpful tools for your trading business.experience running out of capital, which is likely to cause prices to continue to fall. For me personally the stop loss is a life saver,because I've
experienced escaping several times from the losses I experienced thanks to using stop loss. Indeed, we have to manage our capital if you want
to use stop loss optimally, so that after we do stop loss, we can re-enter the market by buying more coins at a cheaper price.
Stop loss is MUST
But it is not enough to keep in control of your budget.
Successful trading requires complex risk management with several risk limits (like overall drawdown, losing trades in a row and so on)
Also, it's about psychology. The idea is not to move your stop and to comply absolutely with your strategy.
Personally, for me the software related to risk management is useful (i use https://www.bitinsure.com/, idk about other similar)
It controls my risks (drawdown, losses and other trading limits and sends me alerts when any of them is reached. Also it gathers and calculates real-time stats so I do not spend any time on monitoring my accounts, looking of drawdown and other risks and have my performance stats at hand
But it is not enough to keep in control of your budget.
Successful trading requires complex risk management with several risk limits (like overall drawdown, losing trades in a row and so on)
Also, it's about psychology. The idea is not to move your stop and to comply absolutely with your strategy.
Personally, for me the software related to risk management is useful (i use https://www.bitinsure.com/, idk about other similar)
It controls my risks (drawdown, losses and other trading limits and sends me alerts when any of them is reached. Also it gathers and calculates real-time stats so I do not spend any time on monitoring my accounts, looking of drawdown and other risks and have my performance stats at hand
Stop loss is unbeatable, it's inception has made trading of cryptocurrency assets more easier and more profitable, the only downside i see to stop loss option in trading cryptocurrency is when you set it on an exchange with low trading volume. Like you said, it's not enough to keep in control of your trading portfolio and as such we've several management tools being proposed and roll out on a daily basis, this is the first time I'm hearing about the platform you suggested but I'll definitely try it out as all these features you wrote out are paramount to proper trading experience
Stop loss is MUST
But it is not enough to keep in control of your budget.
Successful trading requires complex risk management with several risk limits (like overall drawdown, losing trades in a row and so on)
Also, it's about psychology. The idea is not to move your stop and to comply absolutely with your strategy.
Personally, for me the software related to risk management is useful (i use https://www.bitinsure.com/, idk about other similar)
It controls my risks (drawdown, losses and other trading limits and sends me alerts when any of them is reached. Also it gathers and calculates real-time stats so I do not spend any time on monitoring my accounts, looking of drawdown and other risks and have my performance stats at hand
But it is not enough to keep in control of your budget.
Successful trading requires complex risk management with several risk limits (like overall drawdown, losing trades in a row and so on)
Also, it's about psychology. The idea is not to move your stop and to comply absolutely with your strategy.
Personally, for me the software related to risk management is useful (i use https://www.bitinsure.com/, idk about other similar)
It controls my risks (drawdown, losses and other trading limits and sends me alerts when any of them is reached. Also it gathers and calculates real-time stats so I do not spend any time on monitoring my accounts, looking of drawdown and other risks and have my performance stats at hand
It's frustrating when you buy and sell at the wrong times but having a stop-loss is definitely better than nothing!
Stop loss is actually a life saving feature. For us swing traders, it goes a long way to save our ass should the market move in the opposite direction. Although we might incur sone loss but it'll be minimal compared to not having a stop loss order. It acts more like a backup plan. That way, you'll have something to fall back to. That's why professional trader always recommend setting stop loss orders just in case.
Let's not forget that with stop loss orders, the market might go sideways for a bit, and your stop hit and then proceed to move in the direction you originally thought It would. That's one of the worst feelings.
I really like the stop-loss option, to me at least, it provides me with so much more flexibility and often if the market trend goes the other way to what I expected and thus set my stop-loss is usually because of the volatility and I don't really put the blame on the option.
It's frustrating when you buy and sell at the wrong times but having a stop-loss is definitely better than nothing!
It's frustrating when you buy and sell at the wrong times but having a stop-loss is definitely better than nothing!
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