Do you need to stop loss in cryptocurrency trading?
Stop loss is a risk management strategy commonly used in trading. It means that when the price reaches the pre-set stop loss point, you actively close the position to avoid further losses.
No stop loss is needed to buy Bitcoin and Ethereum
Because historically, Bitcoin and Ethereum have never trapped anyone. You need to understand trend theory a little bit, buy bravely when the trend starts, and sell in batches when you make a profit.
Buying altcoins requires stop loss, and contract trading must firmly stop loss.
Because the volatility of altcoins themselves is very large, intraday fluctuations of 30% are very common.
If you don't set a stop loss, it is easy to cut in half;
If the stop loss point is too small, the coin may grow just after closing the position;
If the stop loss point is too large, it may fall badly, resulting in the inability to cut the position;
What to do at this time? You can use position management. Use position management instead of point stop loss
For example, if you use 10w for cryptocurrency speculation, and use it all to buy altcoins, you will lose 5w if you cut in half. Losing 5w is a pain you cannot bear, but losing 1w is bearable.
It is common for altcoins to fall by 50%. You can use 20% of your position to buy altcoins, and you will only lose 10,000 yuan if you cut your position in half. This is an acceptable level of pain, and you can cut your position at this time.
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