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Topic: Tips for trading strategy in STOP LOSS (Read 643 times)

hero member
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Leading Crypto Sports Betting & Casino Platform
October 05, 2024, 01:05:51 PM
#56
How do y'all place a trade at the expense of your pockets? You can seriously rely on how smart you are to çlose a position just about the time it ends? How do you deal with retracements?

I'm asking all of these questions cus alot of people in the comments be acting like they don't really see a need to initiate a stop loss/take profits in any case.
I don't know when I'd decide to rely on candle formations like y'all, considering the volatility of the market and how swift the news can affect and decide changes. I know how much loss i incured when I slept off while my trade was running without these factoids.
Am somewhat sure 99% of those people that says all of that don't really mean or so what they said because they can be very sure of losing money far more than they make by trading under such reckless manner.

Preferably it could be understandable that a trader could decide not to place a TP position as the case may be but not for a SL, especially with futures trading. I'll consider any trade in Futures without an appropriate SL position irrespective of the pairs as gambling with funds.  I have had a few swift fall in my trade's that without SL I would have had a blown account, so I wonder how anyone will get comfortable trading without using SL.
hero member
Activity: 1050
Merit: 844
October 05, 2024, 10:01:52 AM
#55
Stop loss is often used by many exchanges. There are huge benefits of using this system, one of which is that it will be a protection against trades that suddenly reverse direction. Those who use a stop loss system will no longer continue following market movements and will still lock in and be able to control losses.
It only functions to control the level of loss that can be borne by each trader in the exchange that has this feature. And I think it is indeed good to use for all traders because the target of each trader is minimal losses, but they all definitely want much greater profits. So using Stop loss in order to be able to control the level of loss is something that should be and is also quite reasonable for every trader today because it can really help them on the one hand when the price of the assets they have bought suddenly drops.
sr. member
Activity: 532
Merit: 420
Fine by Time
October 05, 2024, 05:54:47 AM
#54
It's definitely better to make a small mistake with taking a small loss if the trade didn't go as expected, than punishing yourself into holding the position with a bigger loss while waiting for the asset to recover. Your position will either get liquidated, OR you will take the bigger loss because you want the "punishment" to stop. Hahaha.

It'll be better if the market wasn't going to recover but if the market is going to recover, you're better off hodling than selling. To make this decision we have to consider the project that we're trading. For Bitcoin trade, there's a certainty that the market is going to recover and you don't have to sell to minimize your loss when you can hodl and maximize your potential gains. The project that we're trading should decide the decisions we're to make and not to view all the projects as one. Trading altcoins, it's better you sell to minimize losses and reopen the trade later.

Stop loss is a vital option to have when trading and for those traders that are trading without a stop loss, they're taking very big risk as there will be no leverage that they're going to have against the market when it's dumping. Stop loss should be fixed about 10% from your entry price and that's all I can add for now.
You have spoken well. We should always be mindful of the assets we are dealing with. Some assets in this condition will not recover and then the best option then it's to take the available money instead of losing more. But if it is Bitcoin of course we know that the market will retrace back even if sometimes we have to wait for weeks or two. The good thing about it is that there is assurance that we won't lose our assets and there is also hope that we can make a profit once it retraces and gets higher in price.

Indirectly, what we should understand between Bitcoins and altcoins is that altcoins don't require patience at all while trading. Because of the risk and inability to completely trust them. While Bitcoin requires patience to trading because there is trust in it. The choice is ours to make. And at the end of the day whatever choice we make we will take responsibility for it.
hero member
Activity: 1722
Merit: 801
October 02, 2024, 09:12:40 PM
#53
The hardest part about focusing is the loss of focus because thats a lot harder to handle. I mean many people try to focus on analysing the economy and they end up losing so much and I think it has to be something that will take a while to arrange and we need to make sure that we are dealing with something that is getting a better result, it shouldn't really matter on the long run, it has to be something that will take a while.
Before trading, they can start with fundamental analysis with macro economy and then the project itself. The next thing to do is determine risk and benefit ratio that means from entry price, they must have two figures, to cut loss price and to take profit price. If ratio of (take profit - entry) / (entry - cut loss) is less than 3:1, it's risky and not recommendable to start that trade.

Some people can do their trade with the ratio is 1:1 but it is more risky and it's not worth to try. Cut loss means you will have actual loss and with the ratio of 3:1, you will have less probability to do a cut loss. Repeat it many times for many trades, you will reduce your loss a lot. If you use 1:1 ratio, your loss in long term will be much bigger.
legendary
Activity: 2660
Merit: 1074
September 27, 2024, 03:39:20 PM
#52
That is why we must always learn more about trading so we can know the situation and also know what we need to do based on the current situation. By learning more about trading, we can test one by one of the methods that we know so we can see which method that may work in the current situation so we can use that to trade. We will have a chance to reduces the losing money in trading because we can analyze better and always trying to prevent the mistake.

Focus is indeed necessary and important when we analyze so we can know the time to enter the market. We can also know how to deal with the risks not to becomes bigger because we will analyze deeper before we make a decision. We must familiar and understand how to trade in the spot trading so that will help us to analyze if we want to try to use futures trading. We must remember that we don't have to use high leverage if we don't have much skills in analyzing because that can make us lose the money.
The hardest part about focusing is the loss of focus because thats a lot harder to handle. I mean many people try to focus on analysing the economy and they end up losing so much and I think it has to be something that will take a while to arrange and we need to make sure that we are dealing with something that is getting a better result, it shouldn't really matter on the long run, it has to be something that will take a while.

I believe that we are going to make money on things that we are going to see and that is why I believe that we are going to see this getting easier the more you do it because veterans can focus a lot easier whereas newbies end up with something that will be hard to focus because they will be hyped and they will make a lot more money that way. So it would be smart decision to just make as much money as you can with what you have and keep getting better and in the end we are going to see this getting a lot better results.
legendary
Activity: 2268
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To the Moon
September 23, 2024, 02:38:32 PM
#51
Stop loss order and take profit is one of the feature most of the exchange have this will serve...

I think that all centralized exchanges and most decentralized ones have similar functions. And those who understand the meaning of Stop loss order and take profit will never trade on such an exchange where these functions are missing. The importance of these functions cannot be overestimated.
legendary
Activity: 3052
Merit: 1188
September 23, 2024, 01:09:02 PM
#50
These features are to make the space safer than just trading without guiding yourself properly because that is exactly what people are used to doing they always want to go the risky way and it will not help you in any way so this is part of the reasons why some of them keep loosing their money because they don't want to follow the procedure just because they want to take a risk and when they dont make any profit they become sad and they will quit and try and discourage people that they have not made any money from trade. not knowing that from the beginning it was all their fault because they knew exactly what instruction to take but they failed to follow because sop lose and tp is a good installed features that help.

Going to aim for a very high profit is what is killing a lot of traders and they will even want to compare their self with other traders people are different but they will tell you that those people started from some were true but they are forgetting the fact that we are different.
You should never compare yourself with other traders, not everyone is the same and the results can't be the same because of that, not in a good way or not in a bad way. Just because you beat someone else, doesn't mean you are better, you could just have better situation in life, or just because you did bad doesn't mean that you are bad, you could had some bad times. I know bad times, I have been living in it for over three years now and I think it's fine to have this type of life troubles without much income, I had trouble trading and investing all through this period and I am fine with it, because I do not compare myself to others.

Just compare yourself to your past self and you will be better, and not even results but how much you know, if you are are a better trader overall, there could still be some bad days and that would be fine, nobody will question it and you should be happy that you are growing as a trader and making some good profits without much trouble as well.
member
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September 23, 2024, 12:40:08 PM
#49
Yes, if a trader can follow the above points well while trading, then it is expected that his chances of losing will be reduced a lot. But also keep in mind that no matter what strategy you use, you will still lose money from here. But the most important thing is to never get depressed. Rather spend more and more time here and get to know it better. You must follow how trading actually works and how you can become a successful trader if you adopt different timings and strategies. Otherwise you must give up hope of profit from here.
sr. member
Activity: 952
Merit: 391
Underestimate- nothing
September 23, 2024, 11:11:21 AM
#48
Stop loss order and take profit is one of the feature most of the exchange have this will serve as a protection of the trader in different purpose like if they don't want to watch the market anymore and let those position cut their trade or serve as a limit of their trade, other people forgot to use this because they keep watching with their trades but again we are aiming for the trade to gain profit now if you think its not ideal anymore why keep holding the position instead the market is volatile possible it make a reverse sweep immediately and instead just a minimal loss you have more than on it. 

These features are to make the space safer than just trading without guiding yourself properly because that is exactly what people are used to doing they always want to go the risky way and it will not help you in any way so this is part of the reasons why some of them keep loosing their money because they don't want to follow the procedure just because they want to take a risk and when they dont make any profit they become sad and they will quit and try and discourage people that they have not made any money from trade. not knowing that from the beginning it was all their fault because they knew exactly what instruction to take but they failed to follow because sop lose and tp is a good installed features that help.

Going to aim for a very high profit is what is killing a lot of traders and they will even want to compare their self with other traders people are different but they will tell you that those people started from some were true but they are forgetting the fact that we are different.
sr. member
Activity: 1624
Merit: 339
https://duelbits.com/
September 22, 2024, 05:45:20 AM
#47
Stop loss order and take profit is one of the feature most of the exchange have this will serve as a protection of the trader in different purpose like if they don't want to watch the market anymore and let those position cut their trade or serve as a limit of their trade, other people forgot to use this because they keep watching with their trades but again we are aiming for the trade to gain profit now if you think its not ideal anymore why keep holding the position instead the market is volatile possible it make a reverse sweep immediately and instead just a minimal loss you have more than on it. 
Stop loss is often used by many exchanges. There are huge benefits of using this system, one of which is that it will be a protection against trades that suddenly reverse direction. Those who use a stop loss system will no longer continue following market movements and will still lock in and be able to control losses.

Here, we have one direction in trading, we definitely want to make a profit or profit. With some advice, we can take a wise attitude and a safe system because market movements are very volatile and reverse direction quickly, so we have to be more sensitive in this trading.
hero member
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Leading Crypto Sports Betting & Casino Platform
September 21, 2024, 03:58:43 PM
#46
Stop loss order and take profit is one of the feature most of the exchange have this will serve as a protection of the trader in different purpose like if they don't want to watch the market anymore and let those position cut their trade or serve as a limit of their trade, other people forgot to use this because they keep watching with their trades but again we are aiming for the trade to gain profit now if you think its not ideal anymore why keep holding the position instead the market is volatile possible it make a reverse sweep immediately and instead just a minimal loss you have more than on it.  
This is very effective. Even you're not a day trader, this is very helpful to those who are just waiting to catch some falling knives *pun intended*.
I mean that buying some lower price and setting it off on the market until it hits. There is no need to pressure yourself into watching the market all day long and at the same time can be used for setting a stop loss for which many are forgetting to use it anymore because they're confident of watching the market and then will only hit those order books when they think that their orders are in danger.

For futures traders, this means a lot to them because this is also helping their pockets getting saved from being liquidated and many don't want to do that. And for the spot traders, you all folks know what to do when you are uncertain with the market. Set around 5% or lower when you can't feel the market and unsure of what's happening, that's already enough stop loss or even 10% will do it just to save you from emotional losing as well.
legendary
Activity: 3710
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www.Crypto.Games: Multiple coins, multiple games
September 21, 2024, 08:15:51 AM
#45
Trying to master stop loss is not an easy thing to do and I think we are going to end up with something that will not be that easy and we should consider this as normal without much issues. I know that it's looking like it's a big deal but at the end of the day we are not going to end up with a big loss if we just keep holding as well. Stop loss is something that traders that deal with short term uses, not something long term investors do, long term investors just hold and that's fine but that doesn't mean that short term traders should hold neither.

Just deal with stop loss in a sense where you want to get out at a certain level and if you think that level is broken then it could go down even more. For example a 55k right now makes sense, because it can go down even more if it goes under 55k, but no need to put it any above because that wouldn't be really that profitable if we are not careful about it. Just focus on keep hodling if it doesn't go any under.
hero member
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September 20, 2024, 09:30:57 PM
#44
By learning more about trading, we can test one by one of the methods that we know so we can see which method that may work in the current situation so we can use that to trade. We will have a chance to reduces the losing money in trading because we can analyze better and always trying to prevent the mistake.
Learning and practice are different and all traders have to start with learning, then practicing with demo trades, then actual trades. It's never expected to be a successful trader with profitable trading after starting. A trader will have to go through many different market phases, bull market vs bear market and a most stressful and boring phase in between bear market and bull market.

To avoid losing money or worse losing all money after several trades, the vital principle is using very small part of capital for trading. Let's afford to split that small capital part to different smaller pieces that will be used to start different trading rounds. Lose one piece, you can restart with other pieces.
Becoming a successful trader will need many things to learned and that will need time before he can trade better. When he can understand the point of his lesson and can practice without have a problem, he will see that his skill improves better but he doesn't have to stop from learning more because the market will always moves. If a trader feels satisfy with his skill and don't want to learns more about trading, his skills, experience, and other things will not improves as before because he can not get a new thing from trading. That will make him feel difficult to trade because he must adapt with the current situation that happen to the market.

Focus is indeed necessary and important when we analyze so we can know the time to enter the market.
Know when to enter the market and have clear idea on when to exit the market. The exit time does not need to be profitable but it is when risk starts to become bigger, and you have to exit the market to defend your capital.
Enter and exit the market is something that we must know so we can act in the right time. Many traders still feels greed to takes more profit even if they already make that profit. When they know when to exit the market, they can stop trading and takes profit and when the market situation change, they can use stop loss feature or just stops trading and exit the market. They will not have a difficulty to analyze the market because they always learning more about trading which help them to know what they needs to do.
hero member
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September 20, 2024, 04:07:59 PM
#43
How do y'all place a trade at the expense of your pockets? You can seriously rely on how smart you are to çlose a position just about the time it ends? How do you deal with retracements?

I'm asking all of these questions cus alot of people in the comments be acting like they don't really see a need to initiate a stop loss/take profits in any case.
I don't know when I'd decide to rely on candle formations like y'all, considering the volatility of the market and how swift the news can affect and decide changes. I know how much loss i incured when I slept off while my trade was running without these factoids.
legendary
Activity: 1750
Merit: 1329
Top Crypto Casino
September 20, 2024, 10:42:14 AM
#42
Stop loss order and take profit is one of the feature most of the exchange have this will serve as a protection of the trader in different purpose like if they don't want to watch the market anymore and let those position cut their trade or serve as a limit of their trade, other people forgot to use this because they keep watching with their trades but again we are aiming for the trade to gain profit now if you think its not ideal anymore why keep holding the position instead the market is volatile possible it make a reverse sweep immediately and instead just a minimal loss you have more than on it. 
sr. member
Activity: 854
Merit: 424
I stand with Ukraine!
September 20, 2024, 07:46:44 AM
#41
By learning more about trading, we can test one by one of the methods that we know so we can see which method that may work in the current situation so we can use that to trade. We will have a chance to reduces the losing money in trading because we can analyze better and always trying to prevent the mistake.
Learning and practice are different and all traders have to start with learning, then practicing with demo trades, then actual trades. It's never expected to be a successful trader with profitable trading after starting. A trader will have to go through many different market phases, bull market vs bear market and a most stressful and boring phase in between bear market and bull market.

To avoid losing money or worse losing all money after several trades, the vital principle is using very small part of capital for trading. Let's afford to split that small capital part to different smaller pieces that will be used to start different trading rounds. Lose one piece, you can restart with other pieces.

Quote
Focus is indeed necessary and important when we analyze so we can know the time to enter the market.
Know when to enter the market and have clear idea on when to exit the market. The exit time does not need to be profitable but it is when risk starts to become bigger, and you have to exit the market to defend your capital.
hero member
Activity: 2912
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Leading Crypto Sports Betting & Casino Platform
September 20, 2024, 03:18:04 AM
#40
That is unfortunate; most of the people who trade as well, they do not know much about the situation and they end up still doing whatever they please and that is the issue. If you are a veteran and doing some good leveraged futures then you could make some money because you know what you are doing, but that is only a small portion of the people and not the whole people and we should realize that majority of the people are just people who end up dealing with something they do not know and that is why they are losing money as well.

I believe that we need to focus on doing things that we know how to do and not deal with anything that will be risky. If you are not a veteran who did amazingly at spot trading first, then do not start doing futures with high leverages neither. The one thing about leverage is that you do not have to put up a lot of money to trade, with small amount of money you can earn so much, which makes people want to give it a try but usually they do not realize that you could also lose 100% of your money with one bad move.
That is why we must always learn more about trading so we can know the situation and also know what we need to do based on the current situation. By learning more about trading, we can test one by one of the methods that we know so we can see which method that may work in the current situation so we can use that to trade. We will have a chance to reduces the losing money in trading because we can analyze better and always trying to prevent the mistake.

Focus is indeed necessary and important when we analyze so we can know the time to enter the market. We can also know how to deal with the risks not to becomes bigger because we will analyze deeper before we make a decision. We must familiar and understand how to trade in the spot trading so that will help us to analyze if we want to try to use futures trading. We must remember that we don't have to use high leverage if we don't have much skills in analyzing because that can make us lose the money.
legendary
Activity: 2716
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Once a man, twice a child!
September 19, 2024, 09:18:36 AM
#39
OP, the number four on your list – Support and Resistance Stop Loss is the only one I'm comfortable using and that's because I like trading lines that don't repaint. I set my SL above a supply zone or below a demand zone and let the trade run its course. It's bad trading habit to adjust SL, no matter what.  Traders who hope for reversals by adjusting their SL often times regret that action. Hope is a terrible thing in trading. If you can't trade what you're seeing on the chart, then don't trade. It's a part of trading discipline.
legendary
Activity: 2086
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September 19, 2024, 08:23:01 AM
#38
Only people who knows their skills that can use that high leverage because they know how to manage the risks. But if that people doesn't know much about futures trading, it is better they avoid the high leverage and they can try to make a small profit but it safe to do. They don't have to chase the profit with not enough skill because that can make their emotion affect and will disturb their trading moment. They can use small money first to see where the market moves and stick to that method will be good for them while they can learn more about futures trading. If they already familiar with futures trading and have a good skills, they can trying to increase their capital to trade but still control themselves in taking the profit.
That is unfortunate; most of the people who trade as well, they do not know much about the situation and they end up still doing whatever they please and that is the issue. If you are a veteran and doing some good leveraged futures then you could make some money because you know what you are doing, but that is only a small portion of the people and not the whole people and we should realize that majority of the people are just people who end up dealing with something they do not know and that is why they are losing money as well.

I believe that we need to focus on doing things that we know how to do and not deal with anything that will be risky. If you are not a veteran who did amazingly at spot trading first, then do not start doing futures with high leverages neither. The one thing about leverage is that you do not have to put up a lot of money to trade, with small amount of money you can earn so much, which makes people want to give it a try but usually they do not realize that you could also lose 100% of your money with one bad move.
hero member
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Leading Crypto Sports Betting & Casino Platform
September 19, 2024, 06:37:15 AM
#37
          -       Entering futures trading without SL but with 100x leverage is just putting their fund at risk, it's like they're just gambling and they don't really have an understanding of trading. Particularly if the matter is technical analysis.

A lot of funds are dissolved in futures that do not or do not use SL, especially if they are set-up on cross margin, their funds will be lost for sure.

Only people who knows their skills that can use that high leverage because they know how to manage the risks. But if that people doesn't know much about futures trading, it is better they avoid the high leverage and they can try to make a small profit but it safe to do. They don't have to chase the profit with not enough skill because that can make their emotion affect and will disturb their trading moment. They can use small money first to see where the market moves and stick to that method will be good for them while they can learn more about futures trading. If they already familiar with futures trading and have a good skills, they can trying to increase their capital to trade but still control themselves in taking the profit.
legendary
Activity: 2898
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September 19, 2024, 03:21:38 AM
#36

Quote

But for "trying" strategies, there's a back-test feature available in TradingView.


Yes, people who want to use trading scripts, bots, can do Back-Test and assess efficiency of the scripts, bots before using it with real fund.


It doesn't need to be for the use of trading scripts/bots. Systems traders can do their back-tests to find out if their strategies are feasible and profitable enough.

One example of a systems-based strategy is the Pi Cycle Top, and Pi Cycle Bottom.  Cool

DYOR!

Quote

Quote

Stay responsible = Use stop-loss


It's one of best weapons against massive loss in this volatile market.

One of the Best Weapons in Trading: stop loss order


Plus use less leverage, or use enough for a portion of your capital, especially if you're trading in a centralized exchange.
legendary
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September 19, 2024, 02:40:47 AM
#35
It's one of best weapons against massive loss in this volatile market.

One of the Best Weapons in Trading: stop loss order

I have mentioned it before in the years of chatting on Trading forum here, I see SL as the basics. It's like, non-negotiable.

So I still find it weird that people trading can talk about SL as if it's the miracle making savior.

If you drive a car, before you even start the engine you put on seatbelt. It's basic driving 101. You even fail your driving test if you didn't do that. So imagine if drivers started thinking, 'wow the best weapon against injury/death in accidents is a seatbelt'. That would be stupid, right? You can say the best weapon is defensive driving, assisted supervision, good material in car etc. But the seatbelt is not the best weapon, it should be standard.

Same as SL in trading. If you're not using it, you shouldn't be trading. Period. It's not the best weapon, it's the prerequisite.
hero member
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Top Crypto Casino
September 19, 2024, 01:51:38 AM
#34
Of course, each trader adheres to his own strategy, but if you average a position, then you increase the risks in this way. And if, as a result, the price moves in the opposite direction to your expectations, your loss will be as many times higher as the amount of the order you have increased.
Well, I often sell half of the position whenever price gets fixed and so far I haven't lost any money with my strategy. I'm someone who only trades Bitcoin with this strategy and sometimes a few less volatile coins, and I haven't yet encountered any loss with it.

I'm not in hurry in opening and closing of my trades and I believe that's the reason why I haven't had any losses with the strategy. Sometimes market moves pretty strangely then in such conditions it's 10x better to go with stop loss instead of averaging.
hero member
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September 18, 2024, 09:14:50 PM
#33
It's essential to make what bigger? I was talking about stop-losses and how THAT makes trading mistakes "small" because stop-losses limit how much an individual might lose. It's not a comment about the size of the positions.
If a trader fails to understand risk in the market, importance of Stop-Loss order, and refuse to use this order to defend his trading capital, to either closing the position with a draw or minimal loss, it's big risk in trading.

If that trader fails to do that with a small trading fund, with a small-size trading position, he will fail with bigger trading capital and get bigger loss. Results would be the same with similar trading style.

There is also another weapon to defend trading capital: Stop-Limit order.

Quote
But for "trying" strategies, there's a back-test feature available in TradingView.
Yes, people who want to use trading scripts, bots, can do Back-Test and assess efficiency of the scripts, bots before using it with real fund.

Quote
Stay responsible = Use stop-loss
It's one of best weapons against massive loss in this volatile market.

One of the Best Weapons in Trading: stop loss order
legendary
Activity: 2898
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September 18, 2024, 09:02:59 AM
#32
You should merely follow your own rules and trade accordingly to avoid making bigger "mistakes". Preserving capital should be your first priority.


You are right. Afterward, it's essential to make it bigger, but if there are no funds or capital to try strategies out, there won't be a possibility for doing so.


?

It's essential to make what bigger? I was talking about stop-losses and how THAT makes trading mistakes "small" because stop-losses limit how much an individual might lose. It's not a comment about the size of the positions.

But for "trying" strategies, there's a back-test feature available in TradingView.

Quote

It's essential to stay responsible and true to yourself regarding different situations where you are tempted into something that may cause bad consequences in the future.


Stay responsible = Use stop-loss
sr. member
Activity: 952
Merit: 303
September 18, 2024, 08:53:24 AM
#31
Have to agree. Any trader that says don't use stop loss is a bad trader. It is simply irresponsible to teach or advice that. Like you said, the only situation where there's no SL required is holding. Then again, true holding doesn't even need an open order

Plus having an open orders will have fees. You don't need to pay the exchanges merely for holding. There's also safety and security risks for holding your capital in those exchanges. They should be paying YOU for giving them your trust and taking such risks. Cool

And that's not even talking about the "goodbye" risks exactly. You can lose it to a hack, lose it to a rogue CEO, so many ways to lose money, people just don't understand until they are bitten. Look at this forum, in the old days, very experienced and early BTC adopters held on MtGox it's unthinkable now!

What is a 'good trading pair' anyway? So good that there will not be flash crashes? Futures is where leverage people go to play, no SL is suicide.

It's where 90% of people learn, the hard way, that they're actually gambling.

I WISH 90% of people learn they're actually gambling. I see traders after 5 years, after 10 years, doing futures on x100 leverage without SL and they still think they're trading.

          -       Entering futures trading without SL but with 100x leverage is just putting their fund at risk, it's like they're just gambling and they don't really have an understanding of trading. Particularly if the matter is technical analysis.

A lot of funds are dissolved in futures that do not or do not use SL, especially if they are set-up on cross margin, their funds will be lost for sure.
legendary
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To the Moon
September 18, 2024, 05:41:09 AM
#30
...been doing exactly what he's doing in the past, it might seems good with averaging, we keep increasing our average price, but there's always a catch, this strategy only works for people with unlimited money to keep maintaining their margin.

This opinion in relation to averaging comes from the fact that sometimes after averaging, the market turns around and the trader gets the best entry price into the position. But this solution is comparable to a casino. Ideally, it is necessary to wait for confirmation of such a reversal and only then open a new position.
hero member
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September 18, 2024, 02:54:56 AM
#29
I personally try my best to avoid stop losses and fix my position with averaging...

Of course, each trader adheres to his own strategy, but if you average a position, then you increase the risks in this way. And if, as a result, the price moves in the opposite direction to your expectations, your loss will be as many times higher as the amount of the order you have increased.

averaging in future contract is like trying to get ourselves bankrupt, people can average as much as they can but there's always chance the market just keep going on opposite direction of our position, SL is more effective in managing risk, if our SL hits and want to reopen position, we can just reopen with better price and got the head start plus remaking technical analysis on top of that.

been doing exactly what he's doing in the past, it might seems good with averaging, we keep increasing our average price, but there's always a catch, this strategy only works for people with unlimited money to keep maintaining their margin.
legendary
Activity: 2268
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To the Moon
September 17, 2024, 04:42:53 PM
#28
I personally try my best to avoid stop losses and fix my position with averaging...

Of course, each trader adheres to his own strategy, but if you average a position, then you increase the risks in this way. And if, as a result, the price moves in the opposite direction to your expectations, your loss will be as many times higher as the amount of the order you have increased.
hero member
Activity: 784
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Top Crypto Casino
September 17, 2024, 04:35:28 PM
#27
I personally try my best to avoid stop losses and fix my position with averaging but sometimes using of stop loss is necessary and in such times I use first type of stop loss strategy that OP mentioned. I believe most traders use the 1st type that's percentage based stop loss, and instead of 2% I sometimes risk 5% to see it the market shifts or not if it doesn't then my stop loss order gets triggered otherwise I hold the position until it becomes green in PNL.
sr. member
Activity: 574
Merit: 310
September 17, 2024, 04:00:19 PM
#26
It's definitely better to make a small mistake with taking a small loss if the trade didn't go as expected, than punishing yourself into holding the position with a bigger loss while waiting for the asset to recover. Your position will either get liquidated, OR you will take the bigger loss because you want the "punishment" to stop. Hahaha.

It'll be better if the market wasn't going to recover but if the market is going to recover, you're better off hodling than selling. To make this decision we have to consider the project that we're trading. For Bitcoin trade, there's a certainty that the market is going to recover and you don't have to sell to minimize your loss when you can hodl and maximize your potential gains. The project that we're trading should decide the decisions we're to make and not to view all the projects as one. Trading altcoins, it's better you sell to minimize losses and reopen the trade later.

Stop loss is a vital option to have when trading and for those traders that are trading without a stop loss, they're taking very big risk as there will be no leverage that they're going to have against the market when it's dumping. Stop loss should be fixed about 10% from your entry price and that's all I can add for now.
sr. member
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September 17, 2024, 08:23:06 AM
#25
I have another opinion regarding stop loss. If you are trading futures and choose good trading pairs, then I would advise you not to put any stop loss. Instead, set “take profit” at a certain percentage. For example, you can take the trading pair of BTC/USDT and can always open a LONG trade whenever you find BTC under 55k. As we know, Bitcoin doesn’t fall very low, and always more people will buy it to increase the price again. Hence, in this manner, you can really make a good profit. You just have to make sure that you have good balance for the trade and the leverage is in control.


Stop loss is actually a great measure against any disaster that might occur  so that you won't be losing more than expected because when you do futures their are various occasions that you will lose money but when you have your stop loss is place. And I know that their situation that you will want to risk and do take profit but when you are taking profit i will go with the suggestions of always going with the pair  of BTC/ USDT and if you looking at this are small information that you need to trade and take long under 55k is might make you profit because you won't always be the lucky one. But when you understand the needful when to take risk you do stop loss and that will be determined by the result you are getting from your technical analysis, and that ia why studying ia very important. With this knowledge you will be able to put everything under control and any way you just have to always cut your loses short.
legendary
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September 17, 2024, 06:12:18 AM
#24
And that's not even talking about the "goodbye" risks exactly. You can lose it to a hack, lose it to a rogue CEO, so many ways to lose money, people just don't understand until they are bitten. Look at this forum, in the old days, very experienced and early BTC adopters held on MtGox it's unthinkable now!
<>

It is not risk taking, it is gambling and they are doing it because they are bored of small income they can make. Making 20-30% even 50% a year is boring in crypto after you work so much, so they want 100% in a day and just get rich in a year and retire, which is not going to happen at all and we can't really jump into making that much money, it's unrealistic and becomes gambling when we do that and we should avoid that if we can, that is the most important part.

20% a year would be amazing, I don't think anyone would make that even if they were a Grade A trader. To consistently make 20% a year, bull or bear, not even the world's top funds in crypto have made that much which also tells you, that they themselves are also taking gambling approach.

You know who makes 20% average long term? Holders Smiley
hero member
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September 17, 2024, 01:01:02 AM
#23
And that's not even talking about the "goodbye" risks exactly. You can lose it to a hack, lose it to a rogue CEO, so many ways to lose money, people just don't understand until they are bitten. Look at this forum, in the old days, very experienced and early BTC adopters held on MtGox it's unthinkable now!
Unfortunately those people are even mostly aware of the mistakes they are doing and they just consider it as just a risk taking and when they label it as taking a risk they think that they are doing something right. Because they could potentially make some money and because of that they think it's fine but the reality is that we are making a mistake if we are not doing this properly and because of that we can't really consider this as a good thing just because they label it taking a risk.

It is not risk taking, it is gambling and they are doing it because they are bored of small income they can make. Making 20-30% even 50% a year is boring in crypto after you work so much, so they want 100% in a day and just get rich in a year and retire, which is not going to happen at all and we can't really jump into making that much money, it's unrealistic and becomes gambling when we do that and we should avoid that if we can, that is the most important part.
legendary
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September 16, 2024, 06:57:08 AM
#22
Have to agree. Any trader that says don't use stop loss is a bad trader. It is simply irresponsible to teach or advice that. Like you said, the only situation where there's no SL required is holding. Then again, true holding doesn't even need an open order

Plus having an open orders will have fees. You don't need to pay the exchanges merely for holding. There's also safety and security risks for holding your capital in those exchanges. They should be paying YOU for giving them your trust and taking such risks. Cool

And that's not even talking about the "goodbye" risks exactly. You can lose it to a hack, lose it to a rogue CEO, so many ways to lose money, people just don't understand until they are bitten. Look at this forum, in the old days, very experienced and early BTC adopters held on MtGox it's unthinkable now!

What is a 'good trading pair' anyway? So good that there will not be flash crashes? Futures is where leverage people go to play, no SL is suicide.

It's where 90% of people learn, the hard way, that they're actually gambling.

I WISH 90% of people learn they're actually gambling. I see traders after 5 years, after 10 years, doing futures on x100 leverage without SL and they still think they're trading.
legendary
Activity: 2268
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To the Moon
September 16, 2024, 06:40:20 AM
#21
...As we know, Bitcoin doesn’t fall very low, and always more people will buy it to increase the price again. Hence, in this manner, you can really make a good profit. You just have to make sure that you have good balance for the trade and the leverage is in control.

Do you think that a 20% price reduction in just one day is not a big deal for Bitcoin, as it was just recently, on August 4? And if you add x10 leverage to this, it is easy to understand that in this case the trader's deposit will be liquidated. And when I see that the liquidation at the dump was $1 billion, I understand that these traders ignore the use of stop loss.
hero member
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September 16, 2024, 06:35:37 AM
#20
I have another opinion regarding stop loss. If you are trading futures and choose good trading pairs, then I would advise you not to put any stop loss.

That's actually, VERY bad advise there ser. Because if you're not going to put ANY stop-loss, then merely hold spot, NOT futures.

Have to agree. Any trader that says don't use stop loss is a bad trader. It is simply irresponsible to teach or advice that. Like you said, the only situation where there's no SL required is holding. Then again, true holding doesn't even need an open order Smiley

What is a 'good trading pair' anyway? So good that there will not be flash crashes? Futures is where leverage people go to play, no SL is suicide.
Well you are actually right on this bro, not using stop loss is actually not ideal if you want to manage your risk properly, though their are so many traders that I knew of that trade without stop loss, but one thing I Know off that they usually do is that, they trade first of all calculate their loss before their profit, like trading with an amount they can afford to lose, so that if things doesn't go their way, they are very much certain that their loss wouldn't affect them that much.

 So  in essence of what am trying to say is that using stop loss is very much good, and it's one of the best way to manage your risk properly in trading, but their are some other ways of managing risk in trading besides using stop loss.

The stop loss is really a big help to us traders because it teaches us to practice ourselves in preventing a big loss in the trading activity that we will do in the exchange. Through this, we can really limit the loss in case the analysis we made on the chart of a platform exchange is wrong.

So SL plays a big role in our traders; honestly speaking, all those with deep knowledge in trading will understand this, and they will not just put aside SL when they have done trading activity in the exchange.
sr. member
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September 16, 2024, 05:13:43 AM
#19
I have another opinion regarding stop loss. If you are trading futures and choose good trading pairs, then I would advise you not to put any stop loss.

That's actually, VERY bad advise there ser. Because if you're not going to put ANY stop-loss, then merely hold spot, NOT futures.

Have to agree. Any trader that says don't use stop loss is a bad trader. It is simply irresponsible to teach or advice that. Like you said, the only situation where there's no SL required is holding. Then again, true holding doesn't even need an open order Smiley

What is a 'good trading pair' anyway? So good that there will not be flash crashes? Futures is where leverage people go to play, no SL is suicide.
Well you are actually right on this bro, not using stop loss is actually not ideal if you want to manage your risk properly, though their are so many traders that I knew of that trade without stop loss, but one thing I Know off that they usually do is that, they trade first of all calculate their loss before their profit, like trading with an amount they can afford to lose, so that if things doesn't go their way, they are very much certain that their loss wouldn't affect them that much.

 So  in essence of what am trying to say is that using stop loss is very much good, and it's one of the best way to manage your risk properly in trading, but their are some other ways of managing risk in trading besides using stop loss.
copper member
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September 16, 2024, 01:37:21 AM
#18
You should merely follow your own rules and trade accordingly to avoid making bigger "mistakes". Preserving capital should be your first priority.

You are right. Afterward, it's essential to make it bigger, but if there are no funds or capital to try strategies out, there won't be a possibility for doing so. It's essential to stay responsible and true to yourself regarding different situations where you are tempted into something that may cause bad consequences in the future.
legendary
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September 16, 2024, 01:19:31 AM
#17
my strategy is to stop loss at support + small percentage for compensation and move the SL to entry when the price mark is already good enough for it to hardly fall.

I find it the best since having floating loss below support is not worth it to hold because it means it has higher chance of going deeper to touch another support.


It's definitely better to make a small mistake with taking a small loss if the trade didn't go as expected, than punishing yourself into holding the position with a bigger loss while waiting for the asset to recover. Your position will either get liquidated, OR you will take the bigger loss because you want the "punishment" to stop. Hahaha.

Quote

but it's still 50:50 you know, even having SL in support doesn't mean the market won't touch it and then bounce back after few minutes making our SL harmful to our asset and rather useless.


You should merely follow your own rules and trade accordingly to avoid making bigger "mistakes". Preserving capital should be your first priority.
legendary
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September 15, 2024, 11:31:08 PM
#16
my strategy is to stop loss at support + small percentage for compensation and move the SL to entry when the price mark is already good enough for it to hardly fall.

I find it the best since having floating loss below support is not worth it to hold because it means it has higher chance of going deeper to touch another support.

but it's still 50:50 you know, even having SL in support doesn't mean the market won't touch it and then bounce back after few minutes making our SL harmful to our asset and rather useless.

I have another opinion regarding stop loss. If you are trading futures and choose good trading pairs, then I would advise you not to put any stop loss. Instead, set “take profit” at a certain percentage. For example, you can take the trading pair of BTC/USDT and can always open a LONG trade whenever you find BTC under 55k. As we know, Bitcoin doesn’t fall very low, and always more people will buy it to increase the price again. Hence, in this manner, you can really make a good profit. You just have to make sure that you have good balance for the trade and the leverage is in control.
this manner of trading require good buying price more preferably at the dip, but I wouldn't recommend not putting SL, when market crashes, your margin account will be emptied.
legendary
Activity: 2898
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September 15, 2024, 05:50:45 AM
#15
I have another opinion regarding stop loss. If you are trading futures and choose good trading pairs, then I would advise you not to put any stop loss.

That's actually, VERY bad advise there ser. Because if you're not going to put ANY stop-loss, then merely hold spot, NOT futures.
 

Have to agree. Any trader that says don't use stop loss is a bad trader. It is simply irresponsible to teach or advice that. Like you said, the only situation where there's no SL required is holding. Then again, true holding doesn't even need an open order


Plus having an open orders will have fees. You don't need to pay the exchanges merely for holding. There's also safety and security risks for holding your capital in those exchanges. They should be paying YOU for giving them your trust and taking such risks. Cool

Quote

What is a 'good trading pair' anyway? So good that there will not be flash crashes? Futures is where leverage people go to play, no SL is suicide.


It's where 90% of people learn, the hard way, that they're actually gambling.

¯\_(ツ)_/¯
hero member
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September 11, 2024, 09:48:26 PM
#14
I believe from the post of OP, the best stop-loss strategy would be the ATR-based stop-loss. It takes into account an assets average volatility taken from "X days" - it could be 7, 14, 21, 28 or any length you want. But two weeks is probably enough to get a good average.

For how much to risk based on an asset's volatility, the user could divide one or two percent of his/her capital by ithr asset's ATR to get the bid size, and subtract the ATR value from the entry price as the stop-loss.
I usually use ATR (Average True Range) indicator to make my calculation on next market change in $. It is not perfect and can not help me to know will market move up or down, but this can help me to calculate, or you can consider it as estimate, if a market moves next with a big change, how much it will move up or fall down. I can calculate it based on past changes of prices with ATR changes. Not perfect but helpful and usable.

I did not use ATR-based stop-loss, honestly.

It's more on the analysis becomes invalid, like for example, it's already days and the price is not going to your plan, like it just sideways, no dump and no pump. So, your stop loss below your entry price is not also being triggered and your price target is also not being triggered or is still far, that's why you will end up closing the position and waiting for another opportunity.
To free up the invested capital for others is not really my problem because I always have capital left on my balance, I only allocate a small percentage per position.
By giving this advice, I see you are a very experienced trader, and I agree with your advice too.

A trading position is opened because of specific conditions when you open it and these conditions only exist within a limited time. So if you can not get a profit with it, you must close that position when the time budget runs out. Let it opens in different positions, than original ones, is very risky.
legendary
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September 10, 2024, 09:00:28 AM
#13
[...]
To free up the invested capital for others is not really my problem because I always have capital left on my balance, I only allocate a small percentage per position.
Thanks for the explanation!

In my trades I am rarely tied up for several hours, so I trade on the lower time frames (30m, 1h, 2h, ...), so stagnating price movements are not as important as if the price does not change for days and you hope for a better entry opportunity.

But in this situation, of course, I understand why you exit the trade prematurely.
legendary
Activity: 2506
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September 10, 2024, 08:23:26 AM
#12
For the time-based stop loss, if my target price or stop loss is not triggered, sometimes I intend to close my position immediately, so this is more manual, so even my current position is already up or down (most of the time it's a small percentage of down/up), I just close it immediately if it's already too long and doesn't go with my plan.
May I ask why do you use time-based stop losses at all? I guess to free up the invested capital for other, more promising trades?
(...)
It's more on the analysis becomes invalid, like for example, it's already days and the price is not going to your plan, like it just sideways, no dump and no pump. So, your stop loss below your entry price is not also being triggered and your price target is also not being triggered or is still far, that's why you will end up closing the position and waiting for another opportunity.
To free up the invested capital for others is not really my problem because I always have capital left on my balance, I only allocate a small percentage per position.
legendary
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September 10, 2024, 06:31:08 AM
#11
I have another opinion regarding stop loss. If you are trading futures and choose good trading pairs, then I would advise you not to put any stop loss.

That's actually, VERY bad advise there ser. Because if you're not going to put ANY stop-loss, then merely hold spot, NOT futures.

Have to agree. Any trader that says don't use stop loss is a bad trader. It is simply irresponsible to teach or advice that. Like you said, the only situation where there's no SL required is holding. Then again, true holding doesn't even need an open order Smiley

What is a 'good trading pair' anyway? So good that there will not be flash crashes? Futures is where leverage people go to play, no SL is suicide.
legendary
Activity: 2898
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September 10, 2024, 03:25:00 AM
#10

I have another opinion regarding stop loss. If you are trading futures and choose good trading pairs, then I would advise you not to put any stop loss.


That's actually, VERY bad advise there ser. Because if you're not going to put ANY stop-loss, then merely hold spot, NOT futures.

Plus are you suggesting not to use leverage because you're advising not to use any stop-loss? Because THAT would be an inefficient way to use capital for trading futures.

Quote

Instead, set “take profit” at a certain percentage. For example, you can take the trading pair of BTC/USDT and can always open a LONG trade whenever you find BTC under 55k. As we know, Bitcoin doesn’t fall very low, and always more people will buy it to increase the price again. Hence, in this manner, you can really make a good profit. You just have to make sure that you have good balance for the trade and the leverage is in control.


Why not merely long term HODL Bitcoin? I'm very confident that would bring OP more profit than that trading "scheme".
hero member
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September 10, 2024, 02:40:40 AM
#9
Thank you for this article, it's very important and I hope the new and struggling traders can make use of it. The stop loss is a crucial tool in trading, without it, the trader is likened to a driver driving a car without a brake, the car may crash at any time due to disregard for safety.

However, among the 5 points you raised, I use 3 of them and the 4th and 5th points can be merged together as the use of indicator strategies to place the stop loss. In addition, one may use the candlestick high and low for this and even the pattern on the trading chart, they are the most effective ones I know.

But I can't use the time-based approach, it's not professional to me as the market condition is not predictable. Another one is the fixed stop loss, but you did not mention it.
legendary
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September 10, 2024, 12:43:36 AM
#8
For the time-based stop loss, if my target price or stop loss is not triggered, sometimes I intend to close my position immediately, so this is more manual, so even my current position is already up or down (most of the time it's a small percentage of down/up), I just close it immediately if it's already too long and doesn't go with my plan.
May I ask why do you use time-based stop losses at all? I guess to free up the invested capital for other, more promising trades?

Otherwise, time-based stop losses hardly make any sense purely from a market movement perspective, you only make life more difficult for yourself as a trader if you have to take an additional component (i.e. time in this case) into account in your trades Smiley

For me, time only plays a role in my DCA purchases, but I use it purely for building up my HODL positions (BTC, ETH, ...).
copper member
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September 10, 2024, 12:39:54 AM
#7
Thank you for sharing your post OP. I believe it is crucial to manage your risk in trading and maintain a disciplined, emotionless approach. This is especially important in the cryptocurrency market, where volatility can quickly turn a winning trade into a loss.

I remember a saying that it's best to keep money rather than lose money. If you translate int into trading, limiting your losses will be the best approach in the long run rather than just doing YOLO per trade.

Do percentage-based risks; using 5% trading capital and then 5% stop loss is excellent.

I fully support you.
It's important to trade responsibly in order to gain something out of it overall, not to slowly drain your portfolio dry.
legendary
Activity: 2506
Merit: 1394
September 09, 2024, 07:23:25 PM
#6
4. Support and resistance stop loss
5. Time-Based Stop Loss
I commonly use these kinds of stop losses, because somehow it is the one that decides if my analysis becomes invalid for example, if I am using the strategy of support and resistance then it's the best thing to use, but most of the time I intend to adjust the stop loss, not putting the order exactly on the support/resistance to avoid stop loss hunts.

For the time-based stop loss, if my target price or stop loss is not triggered, sometimes I intend to close my position immediately, so this is more manual, so even my current position is already up or down (most of the time it's a small percentage of down/up), I just close it immediately if it's already too long and doesn't go with my plan.
copper member
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September 09, 2024, 12:51:28 PM
#5
Thank you for sharing your post OP. I believe it is crucial to manage your risk in trading and maintain a disciplined, emotionless approach. This is especially important in the cryptocurrency market, where volatility can quickly turn a winning trade into a loss.

I remember a saying that it's best to keep money rather than lose money. If you translate int into trading, limiting your losses will be the best approach in the long run rather than just doing YOLO per trade.

Do percentage-based risks; using 5% trading capital and then 5% stop loss is excellent.
copper member
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September 09, 2024, 12:47:21 PM
#4
I have another opinion regarding stop loss. If you are trading futures and choose good trading pairs, then I would advise you not to put any stop loss. Instead, set “take profit” at a certain percentage. For example, you can take the trading pair of BTC/USDT and can always open a LONG trade whenever you find BTC under 55k. As we know, Bitcoin doesn’t fall very low, and always more people will buy it to increase the price again. Hence, in this manner, you can really make a good profit. You just have to make sure that you have good balance for the trade and the leverage is in control.
legendary
Activity: 2898
Merit: 1823
September 09, 2024, 07:40:03 AM
#3
I believe from the post of OP, the best stop-loss strategy would be the ATR-based stop-loss. It takes into account an assets average volatility taken from "X days" - it could be 7, 14, 21, 28 or any length you want. But two weeks is probably enough to get a good average.

For how much to risk based on an asset's volatility, the user could divide one or two percent of his/her capital by ithr asset's ATR to get the bid size, and subtract the ATR value from the entry price as the stop-loss.

¯\_(ツ)_/¯
hero member
Activity: 1722
Merit: 801
September 05, 2024, 10:06:59 PM
#2
Stop-Loss order: one of best weapons in trading.

There is another order type, Stop-Limit order that is helpful and in market crash, it is more helpful than Stop-Loss order to help you avoid too big slippage.

Stop-Limit Order.
Stop-Loss vs. Stop-Limit Order: What's the Difference?
sr. member
Activity: 952
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September 05, 2024, 08:30:54 AM
#1
        -       In this topic, we will talk about the stop-loss strategy that can be used by any trader, whether a newbie or a long-time trader. You will definitely get more knowledge from it. In fact, I personally used some of the stop-loss strategy that we will talk about; it may or may not be effective for others. Because we have different approaches to the market.  STOP LOSS is a fundamental concept in trading that is used in any volatile market, such as cryptocurrency, forex, and stocks.

This is the pre-set order that we place in the exchange to sell assets when it reaches a certain price level. And the primary goal of the stop loss is to limit our losses in the trade.  For example, I bought a token worth 100$ each because my expectation is that it will increase in the near future, but in case my assumption is wrong, I will set SL at a price of 90$ so that I will only lose 10$. instead of scraping all my balance fund, and at least I only lost 10%, not 90%. Now, why is SL important in trading? Always, that is because it plays a big role in our risk management or it serves as our safety net for excessive losses in the event of unfavorable market movement.  Because if we don't do anything, Stop Loss is a tendency. We might hold our losing position and hope that things will turn around and maybe even win, but in reality it won't happen. Therefore, SL (stop loss) helps to limit our losses, reduce emotional trading, and improve planning. Because before we enter trading, we already have an expectation that we can win or lose in the activity we will do.  At least in this way, it can give a realistic expectation that it won't be too painful for us or we won't feel it too much anymore. It seems we already know the possibilities.

1. Percentage-based stop loss

This is the simplest or most widely used stop-loss strategy; these are also the methods that are taught in textbooks, like you only need to risk 2% per trade, so if you have read trading books, you already know that. This is part of our risk management as traders.

How it functions:

Decide on the maximum proportion of your money that you are willing to risk on a trade in order to determine the percentage.

Generally speaking, this ranges from 1% to 3%, although it might change depending on your trading style and risk tolerance.
Determine the stop loss price: After deciding on a percentage, figure out the price at which the stop loss will be activated. You accomplish this by deducting the percentage from the cost of admission.
As an illustration

Cost of admission: $100
Percentage at risk: 2%
$100 - (2% of $100) = $98 is the stop loss price.
Your loss will be limited to 2% if the price falls to $98 or below, at which point the stop loss order will be triggered, instantly terminating the trade.

The advantages of stop losses based on percentages:

Risk management: Assists in limiting possible losses and shields against large setbacks.
Objectivity: Makes decisions less emotionally driven by offering a clear exit strategy based on a preset percentage.
Consistency:Adaptable to various asset classes and trading strategies.

Taking into account:

Market volatility: In times of extreme volatility, it's possible that a stop loss won't always be implemented at the precise price you select.
False triggers:Transient price changes may set off stop losses, resulting in needless losses.
Lost opportunities: If the market moves considerably in your favor, a stop loss might keep you from making further gains.


2. Moving average stop loss

Personally, I don't use this method, but there are other traders who are more comfortable using it, so normally, they use 50 or 200 MA, depending on trader preference, because it serves as dynamic support and resistance.  It's just a simple thing to remember here: when you're in a short position, the SL you put is above the moving average, and when you're in a long position, your stop loss is below the MA(moving average).

Moving average stop loss advantages:

Dynamic adjustment: This lowers the possibility of false triggers by dynamically adjusting the stop loss to market conditions.
Trend following: By keeping up with the market's movement, the stop loss may make room for bigger gains.
Risk management: Promotes profit-taking while assisting in the prevention of possible losses.


3. ATR (average true range)stop loss

Many traders also use this strategy so they can determine the stop loss level. For those who code the bot, this is what they often use and do to measure the distance or depth of the stop loss, depending on the volatility. This means that these indicators measure market volatility. When the ATR value is high, it indicates high volatility. And when the ATR value is low, it means the volatility is also low.  So ATR becomes flexible when using this strategy. So, I suggest that it is better to use it for traders who love trading bots.

How Functions:

- Determine the ATR value for a certain time period (e.g., 14 days) by doing an ATR calculation.
- Place First Stop Loss: Place the first stop loss below the market price.

Modify the stop loss: An increasing ATR means that the stop loss is moved further away from the current price. An increasing ATR indicates greater volatility.

Falling ATR: When the ATR goes down, it signals less volatility, and the stop loss is moved in closer proximity to the current price.

ATR Stop Loss Benefits:

Dynamic Adjustment: This minimizes the chance of being stopped out by brief price swings by automatically adjusting the stop loss to shifting market circumstances.
Effective risk management: allows for profit-taking while also assisting in the control of possible losses.
Based on Market Volatility: The ATR stop loss is more adaptable to shifting market conditions because it is based on market volatility.

4. Support and resistance stop loss

This is the typical one where traders place a stop loss below support and above the resistance level. The idea about stopping loss of swing high and below swing low also came from here. The swing point is the support and resistance level. Normally, when we take a long position in a support area, our SL becomes below it, and on the contrary, when we take a SL in resistance, it is at the top.

Encouragement and Opposition Stop Loss Advantages:

-  Technical Analysis Makes well-informed recommendations about where to place stops based on technical analysis.
-  By placing stop loss orders at important price points, risk management helps to contain any losses.
-  Integration with many trading techniques is possible.

Considering
1. Support and resistance levels can change over time and are not always the same. These are known as dynamic levels.
2. Phasic Breakouts: The market can momentarily breach a level of support or resistance before pulling back.
3. Conditions of the Market: The performance of stop loss and support strategies can change based on the state of the market.

As an example:

Support Level: A stop loss could be set at or slightly below $50, for example, if the price of the security has regularly found support there.
Resistance Level: A stop loss could be positioned just above the $70 mark, for example, if the price of a security had previously experienced resistance there.

5. Time-Based Stop Loss

This is what we will exit the trade in a certain period, regardless of a price movement. I also do this from time to time when it's really necessary and it's really wrong to trade knowing that it will only lead to a big loss. So, on a case-to-case basis, we do this even if we already have a stop loss. Sometimes there is a chance that we will enter the trade when the position has been open for a long time and the SL or TP has not yet been cut. Meaning, when nothing changes for a long time, we need to close the position.

How to use it:

Establish Timeframe: Choose the precise amount of time (hours, days, weeks, etc.) that you wish to devote to the role.
Place Order: Start trading and establish a time-based stop loss.
Automatic Closure: Regardless of whether the position is profitable or losing money, it will automatically close after the designated amount of time has elapsed.

Time-Based Stop Loss's Advantages

-  Risk management limits exposure to a trade for a predetermined amount of time, which helps to control potential losses.
-  Enforces discipline by making traders leave positions, even if they have strong emotional ties to them.
-  Simplicity: Simple to apply and comprehend.

Disclaimer: this is not a financial advice instead its for educational purposes only.

Good day everyone Wink


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