Topic: Using Trailing Stop Orders? (Read 144 times)

I don't know about everyone else but I find it stressful to use a trailing stop order or trailing stop limit order. Over the course of my trading journey, I usually use the good old limit orders or stop orders if need be. So far so good, I haven't had the need to use a trailing stop. I'm not really big on placing orders that gets trailed by a certain percentage/amount. Instead, I manually set my stop limit orders.


Like you, I feel the same way too. I'm not too big on finding secret strategies or using some magical indicators just to win trades.

It is not difficult to establish the timing that much, it is definitely the hardest part of any of this and I agree, but it is not really that difficult neither in time nor in % if you want to go with either of them. You could basically do it once per month and you could be done with it, or do it each 10% and you can be done with it.

Do not overthink your strategies because bitcoin is something that is profitable to everyone in the long term, even if the price falls eventually, you could DCA your way out of it quickly or you could hold long enough that you could profit from it in the end.

So, do not try to find a small secret way to make a profit from bitcoin trading, do it the way everyone else who profits does, get in and wait for it to be profitable for you to sell.

What you describe here sounds like a grid trading strategy done manually.
Indeed a risk management strategy.

It is possible to use trailing stop on derivatives/margin but the leverage multiply the distance between the price and the trailing value by the same factor, which makes it even more difficult to setup properly.

I've used trailing stop-markets a few times about 2 years ago when I was trading on leverage, but soon after that I found a better way to lower the risk amount, and it's very close to what stop orders does based on what it does to your open position, and that's just dollar cost averaging which is way simpler to use and less risky(since your open your position with way less funds) and even more effective than trailing stop markets,

For example if you usually buy 10k contracts which every contract will cost you $1 then you divide that 10k into 3-5-10 parts or whatever else depending or your risk tolerance, and that way you can buy more contracts(add more to your position) for example every %5 that your position goes down and at the same time your average entry price will change to a better price.

Example: Your plan is to buy the total of 1000 contracts at most, you start by buying 100 long contracts and that asset goes down %5 against you, you will then add 200 contracts which will decrease your average entry price in your favor, and another time it goes down another 5% you do the same but this time you add more contracts(300 contracts) to your position and so on, and you are changing your entry price in your favor every time you add more contracts this way, the only problem with this strategy is that it will give less profit but it also minimizes the risk significantly which is worth it in my opinion.

Every technique no matter how advanced is bound to have some drawbacks, however I really think that all of the issues that a trailing stop has should not really stop people from using it, it is an incredible tool in the arsenal of a trader, many people do not put a lot of attention to it because is not a tool that allows you to predict the markets and make more money, however a trailing stop is going to save your money and to consolidate your profits and that is a very good thing especially when we see a market crash.

I don't like trailing stop specially when you are actively trading its better to have that manual stopping of orders but somehow this do need ample time on checking out
your trades from time to time.

When you are on afk or in automation then having SL or single ones is much more preferable yet I do have bad experiences on trailing stop commands or set up
where it did result into more further losses which would hard to make some recoveries.I do rather on considering average down type of game
or accumulation on bottom.

I do not use it for trading, the cowards are the ones who need such orders, you must search for a currency, research all the options available in that currency, and then decide whether it is worth the risk or not, and keep it for a short period, such as 3 months or more than a year.
All orders that are made which depend on a small percentage may result in lost money.

I like the trailing stop order, but I have not used it before, but with this article, I can be able to understand that if someone trade,m and the market price of the coin is increasing, the trailing stop order will also make the price atwjich the stop lose will be to increase, I think this is just good as I do not have to be watching my trades often daily. But, I am still confused, if to establish the ideal distance can be difficult, which means this can go wrong in a way that if price is not favoring can still lead to losses. I am currently still using limit order which is still useful for beginners like me.

Its hard for me to imagine how long term trader you need to be to use TSO. Is it that hard to take a look at investment once a week to adjust stop-loss and place it in strategic place based on statistic advantege (called TA). Like beghind support etc not in random position based on short term fluctuation?


Its the same with regular stop-loss and every professional trader that cares about its money and is not a "gabler on market" is using it.

The main negative aspect of trailing stop is that it cuts the trader profit that would have been taking because it catches up with trade as fast as the trade is running. That is a little drop back in price can cut off the trade order which would have given better profit. Trailing IMO is same as scalping while trailing is controlled by the platform as trading indicator. It is built with the platform while scalpers do it themselves by being on the system to watch the price movement.

Just wrote a medium article about it: https://tradingbull.medium.com/trading-101-order-types-trailing-stop-limit-order-tslo-ab747cf447a4

Trailing stop (TSO) is used to secure profits and limit losses as the market price moves favorably for the trader.
As the market price moves up, the stop-loss order value is adjusted to remain either at a % away of the current market price or at a fixed price difference in value.

Pros: Long-term holders can dynamically secure a long-term position without need for day trading.
Trail order is also not shown on public order book.
Cons: Establishing the ideal distance can be difficult.

Trailing stop limit order (TSLO) is similar to trailing stop but allows traders to specify a limit order on the stop loss instead of being transformed into a market order when the trigger is met.

Pros: Long-term holders can dynamically secure a long-term position without need for day trading.
Trail Order is also usually not displayed to other traders on the public order books.
Cons: Establishing the ideal distance can be difficult.
Conversion to a limit order may reduce traders’ chances to fullfil the order quickly based on market conditions.

Do you guys use TSO & TSLO while trading crypto?

Do you see other advantages/inconvenient to it?