The first step to getting rich in crypto trading is to set stop-loss and take-profit points. Here are five practical ways to do that:
Percentage stop-loss method: This is the most common stop-loss strategy. When buying cryptocurrencies, investors should set a percentage as the stop-loss point in advance. For example, you can decide to automatically sell if a certain coin drops more than 10%. This method is simple and effective, and helps to control risk.
Fixed amount stop-loss method: This method involves setting a fixed amount as the stop-loss point. For example, if an investor is only willing to bear a maximum loss of 1000 US dollars, then sell immediately once the loss reaches this amount. This method is especially useful for investors with limited budgets.
Indicator stop-loss method: In cryptocurrency trading, technical indicators such as MACD death cross, RSI overbought or oversold, Bollinger band breakout, etc. can serve as stop-loss signals. By analyzing these technical indicators, investors can more accurately decide when to exit the market.
Logic destruction method: If the original logic of buying a cryptocurrency (such as a technical breakthrough, partnership, etc.) is no longer valid, then you should consider selling. Sticking to an invalid investment logic often leads to bigger losses.
Moving stop-loss method: Also known as trailing stop-loss method. This method allows investors to gradually adjust the stop-loss point as the market price rises, thus protecting profits while leaving room for further growth. This strategy is suitable for fast-changing markets, and can maximize investors' profits.
