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What does Buy/Long Trailing Stop mean in futures? And why can I only set price below the current market price?
Does it mean the Long Position order will be triggered when the price goes down until it reaches the set price, and then the Tailing Order will be activated? After that, when the price increases until it decreases(for 2% B/C), the Trailing order will be closed and I get profit from the increase in price? (since it was a long position)
Also, from what I understand, I should
first open a Long/Short position
and then set/open the Trailing stop order for that order (so the amount or the two orders should be the same)
What I'm confused is the opening trailing stop. Does it mean I don't need to have an already opened position and the trailing stop will start right at the Trailing Stop order?
#trading #trailingstoploss #Tutorial #help #Question
Does it mean the Long Position order will be triggered when the price goes down until it reaches the set price, and then the Tailing Order will be activated? After that, when the price increases until it decreases(for 2% B/C), the Trailing order will be closed and I get profit from the increase in price? (since it was a long position)
Also, from what I understand, I should
first open a Long/Short position
and then set/open the Trailing stop order for that order (so the amount or the two orders should be the same)
What I'm confused is the opening trailing stop. Does it mean I don't need to have an already opened position and the trailing stop will start right at the Trailing Stop order?
#trading #trailingstoploss #Tutorial #help #Question
Maximize Your Profits and Manage Your Risk with Trailing Stop Orders
So, Binance finally added Trailing Stop-Loss Orders for us to automate at least some of our trades. This is a very useful feature which saved me many times from big dumps, so I'm sharing with you a simplified break down of what this type of order does and how to use it.
If you're looking for a way to protect your profits and manage your risk when trading stocks, a trailing stop order might be just what you need. By setting a stop loss level that automatically adjusts as the stock price moves, you can minimize your losses and lock in profits while also allowing for further upside potential. In this article, we'll take a closer look at how trailing stop orders work and provide some real-world examples of how to use them effectively in your trading strategy.
Trailing stop orders are a type of trade order that is used in financial markets such as stocks, forex, and cryptocurrencies. This type of order is used to help traders lock in profits and limit their potential losses.
Trailing stop orders are a type of trade order that is used in financial markets such as stocks, forex, and cryptocurrencies. This type of order is used to help traders lock in profits and limit their potential losses.
A trailing stop order is an order that automatically adjusts the stop loss level as the price of the asset moves in the trader's favour. The stop loss level is the price at which the trader's position will be automatically closed out if the market moves against them. It can be placed in both directions (buy or sell).
The trailing stop order works by setting a trailing stop distance, which is the number of points or percentage distance from the current market price. The stop loss level is then adjusted as the market price moves in the trader's favour, but never in the opposite direction. This allows the trader to lock in profits as the market moves in their favour while also limiting their potential losses. If it's a sell order, the stop loss price will move up as the token price goes up. Then, when the market takes a dip, the stop loss will not move down, so the order will get executed if the price of the token reaches that of the stop loss. So, if you placed a stop loss of 8% let's say, then your sell order will get executed when the market drops by 8% or more from the highest price that was recorded while your order was active.
It's important to choose the right trailing stop loss for your trades. A stop loss that's too tight, such as 3% or 5%, may result in the trade being stopped out before the price has a chance to move higher due to minor pullbacks that tend to move more than this. On the other hand, a 20% trailing stop is excessive and may not be suitable based on recent trends. You have to take into account the regular market moves. If the average pullback of the pair you're trading is about 4-5%, with bigger ones near 8%, then you don't want to place a stop loss less than that. A 3-4% stop loss would mean that the typical market volatility can easily eat your stop loss quickly and you're out of the trade. Maybe even at a small loss. What I mean, is that if you're trading longer term and chasing bigger market moves, a better option would be a trailing stop loss of 10% to 12%, which provides enough room for the trade to move while getting the trader out quickly if the price drops by more than 12%. This is larger than a typical pullback, which could indicate a trend reversal instead of just a pullback. Ideally, this is what your goal is. You want to prevent losses from a trend reversal, not just a minor pullback. Unless you're trading short term: small moves. In that case, a 3-4% stop loss can save you from a bigger move of say - 5% or 7% - this would work fine for a short term swing trade, but you'll have to be proactive and make sure you monitor that pair closely, so you can jump in soon after, before you miss another rally.
For example:
Let's say you bought ETH at $1000 and set a trailing stop order with a trailing stop distance of 10%. This means that your stop loss level will be adjusted to 10% below the highest price the token reaches after you buy it. Your stop-loss being 10% is originally sitting at $900. If the price moves up to $1100, your stop loss level will be adjusted to $990 ($1100 - 10%). If the price continues to rise and reaches $1200, your stop loss level will be adjusted to $1080 ($1200 - 10%). If the price then drops to $1080 or below, your position will be executed at the stop loss level of $1080, limiting your potential losses to 10% and locking-in a small profit of $80.
On the other hand, if the token price continues to rise and reaches $1300, your stop loss level will be adjusted to $1170 ($1300 - 10%). If the price then drops to $1170 or below, your position will be automatically executed at the stop loss level of $1170, locking in a profit of $170 per token.
With a tighter stop-loss it will look like this:
You bought ETH below $1000 and set up a stop loss at $1000 at 4%, your stop loss level would be originally set at $960 ($1000 - 4%). If the price drops to $960 or below, your position will be automatically closed out at the stop loss level, limiting your potential losses to 4%. Let's say the price actually rises to $1100, your stop loss has moved up too and it's now set at $1056 (4% below $1100). Then the price falls back to $1050. Your order is triggered by this drop and ideally you sell at $1056, locking in a small profit of $56 but avoiding bigger loss. If the price doesn't fall, but goes higher, reaches $1200, your stop loss will have adjusted upwards to $1152 ($1200 - 4%). A subsequent drop to that price level will trigger your order and you can lock in a profit of around $150 depending on how fast your order can be executed. If it's indeed in Ether, there's a lot of liquidity, high trading volumes, so you're okay. Some altcoins have very low liquidity, so you have to be careful with those.
And also, if the token price continued to rise, the trailing stop loss level would also continue to trail the price, moving upwards as the token price continued to climb. This would allow you to continue to participate in any further upside potential while also providing downside protection in case the stock price were to suddenly reverse and decline. But if a 4% or 5% stop is the typical market volatility, then you can be out of this trade too soon.
This is why you need to test this out a few times before you can use it more confidently. Make sure you research the market well, so you know what to expect. What are the most likely moves, the most likely scenario. I'm not saying you have to know exactly what will happen - this is not possible. But we use technical analysis to be able to tell what is likely to happen, usually there are at least two or three scenarios that can play out and being able to read the charts and anticipate certain moves, will be essential for making this work best for you.
Disclaimer: Trailing stop orders can be a useful tool for traders who want to take advantage of market movements while limiting their potential losses. However, it's important to note that trailing stop orders do not guarantee profits or prevent losses in all market conditions, and traders should always have a risk management strategy in place.
#tradingStrategy #trading #stoploss #trailingstoploss #technicalanalysis
If you're looking for a way to protect your profits and manage your risk when trading stocks, a trailing stop order might be just what you need. By setting a stop loss level that automatically adjusts as the stock price moves, you can minimize your losses and lock in profits while also allowing for further upside potential. In this article, we'll take a closer look at how trailing stop orders work and provide some real-world examples of how to use them effectively in your trading strategy.
Trailing stop orders are a type of trade order that is used in financial markets such as stocks, forex, and cryptocurrencies. This type of order is used to help traders lock in profits and limit their potential losses.
Trailing stop orders are a type of trade order that is used in financial markets such as stocks, forex, and cryptocurrencies. This type of order is used to help traders lock in profits and limit their potential losses.
A trailing stop order is an order that automatically adjusts the stop loss level as the price of the asset moves in the trader's favour. The stop loss level is the price at which the trader's position will be automatically closed out if the market moves against them. It can be placed in both directions (buy or sell).
The trailing stop order works by setting a trailing stop distance, which is the number of points or percentage distance from the current market price. The stop loss level is then adjusted as the market price moves in the trader's favour, but never in the opposite direction. This allows the trader to lock in profits as the market moves in their favour while also limiting their potential losses. If it's a sell order, the stop loss price will move up as the token price goes up. Then, when the market takes a dip, the stop loss will not move down, so the order will get executed if the price of the token reaches that of the stop loss. So, if you placed a stop loss of 8% let's say, then your sell order will get executed when the market drops by 8% or more from the highest price that was recorded while your order was active.
It's important to choose the right trailing stop loss for your trades. A stop loss that's too tight, such as 3% or 5%, may result in the trade being stopped out before the price has a chance to move higher due to minor pullbacks that tend to move more than this. On the other hand, a 20% trailing stop is excessive and may not be suitable based on recent trends. You have to take into account the regular market moves. If the average pullback of the pair you're trading is about 4-5%, with bigger ones near 8%, then you don't want to place a stop loss less than that. A 3-4% stop loss would mean that the typical market volatility can easily eat your stop loss quickly and you're out of the trade. Maybe even at a small loss. What I mean, is that if you're trading longer term and chasing bigger market moves, a better option would be a trailing stop loss of 10% to 12%, which provides enough room for the trade to move while getting the trader out quickly if the price drops by more than 12%. This is larger than a typical pullback, which could indicate a trend reversal instead of just a pullback. Ideally, this is what your goal is. You want to prevent losses from a trend reversal, not just a minor pullback. Unless you're trading short term: small moves. In that case, a 3-4% stop loss can save you from a bigger move of say - 5% or 7% - this would work fine for a short term swing trade, but you'll have to be proactive and make sure you monitor that pair closely, so you can jump in soon after, before you miss another rally.
For example:
Let's say you bought ETH at $1000 and set a trailing stop order with a trailing stop distance of 10%. This means that your stop loss level will be adjusted to 10% below the highest price the token reaches after you buy it. Your stop-loss being 10% is originally sitting at $900. If the price moves up to $1100, your stop loss level will be adjusted to $990 ($1100 - 10%). If the price continues to rise and reaches $1200, your stop loss level will be adjusted to $1080 ($1200 - 10%). If the price then drops to $1080 or below, your position will be executed at the stop loss level of $1080, limiting your potential losses to 10% and locking-in a small profit of $80.
On the other hand, if the token price continues to rise and reaches $1300, your stop loss level will be adjusted to $1170 ($1300 - 10%). If the price then drops to $1170 or below, your position will be automatically executed at the stop loss level of $1170, locking in a profit of $170 per token.
With a tighter stop-loss it will look like this:
You bought ETH below $1000 and set up a stop loss at $1000 at 4%, your stop loss level would be originally set at $960 ($1000 - 4%). If the price drops to $960 or below, your position will be automatically closed out at the stop loss level, limiting your potential losses to 4%. Let's say the price actually rises to $1100, your stop loss has moved up too and it's now set at $1056 (4% below $1100). Then the price falls back to $1050. Your order is triggered by this drop and ideally you sell at $1056, locking in a small profit of $56 but avoiding bigger loss. If the price doesn't fall, but goes higher, reaches $1200, your stop loss will have adjusted upwards to $1152 ($1200 - 4%). A subsequent drop to that price level will trigger your order and you can lock in a profit of around $150 depending on how fast your order can be executed. If it's indeed in Ether, there's a lot of liquidity, high trading volumes, so you're okay. Some altcoins have very low liquidity, so you have to be careful with those.
And also, if the token price continued to rise, the trailing stop loss level would also continue to trail the price, moving upwards as the token price continued to climb. This would allow you to continue to participate in any further upside potential while also providing downside protection in case the stock price were to suddenly reverse and decline. But if a 4% or 5% stop is the typical market volatility, then you can be out of this trade too soon.
This is why you need to test this out a few times before you can use it more confidently. Make sure you research the market well, so you know what to expect. What are the most likely moves, the most likely scenario. I'm not saying you have to know exactly what will happen - this is not possible. But we use technical analysis to be able to tell what is likely to happen, usually there are at least two or three scenarios that can play out and being able to read the charts and anticipate certain moves, will be essential for making this work best for you.
Disclaimer: Trailing stop orders can be a useful tool for traders who want to take advantage of market movements while limiting their potential losses. However, it's important to note that trailing stop orders do not guarantee profits or prevent losses in all market conditions, and traders should always have a risk management strategy in place.
#tradingStrategy #trading #stoploss #trailingstoploss #technicalanalysis
How to Use Trailing Stop Loss Orders on Binance to Protect Your Gains and Limit Losses
Introduction:
When it comes to trading in the exciting world of cryptocurrencies, managing risk is crucial. One effective tool that can help you protect your gains and make informed trading decisions is the trailing stop loss order. In this article, we will explore how to use and determine the right time to employ trailing stop-loss orders specifically on the user-friendly Binance exchange.
Understanding Trailing Stop Loss Orders on Binance: Trailing stop loss orders on Binance are designed to adapt to market movements automatically. These orders allow traders to secure profits and limit potential losses as the market fluctuates. Binance provides an intuitive platform that empowers traders to take control of their risk exposure.
How to Use Trailing Stop Loss on #Binance
Trailing Stoploss
Choose Your Cryptocurrency:
Start by selecting the cryptocurrency you wish to trade and access the relevant trading pair on Binance.
Determine the Trailing Percentage:
Set the trailing percentage based on your risk tolerance and the unique characteristics of the cryptocurrency. A higher trailing percentage gives more room for market fluctuations, while a lower percentage tightens control.
Set the Initial Stop Price:
Establish an initial stop price that aligns with your risk appetite and analysis. This will serve as the starting point for your trailing stop loss order.
Keep an Eye on Market Conditions:
Regularly monitor market conditions and adjust your trailing stop loss order accordingly. In trending markets, consider tightening the trailing percentage to protect your profits. During highly volatile periods, widen the trailing percentage to account for market noise.
When to Use Trailing Stop Loss on Binance:
Take Advantage of Trending Markets: Trailing stop loss orders are particularly effective during trending markets. When a cryptocurrency shows a clear upward or downward trend, using a trailing stop loss can help you ride the trend while safeguarding against sudden reversals.
Managing Highly Volatile Cryptocurrencies: Some cryptocurrencies experience rapid price movements due to their inherent volatility. In such cases, trailing stop-loss orders can help you capture profits during upward swings while providing a buffer against sudden downturns.
Secure Your Trades During Absences: If you anticipate being away from your trading desk for an extended period, setting trailing stop loss orders can provide peace of mind. These orders adjust automatically based on market conditions, enabling you to manage risk even when you're not actively monitoring the market.
Conclusion: By incorporating #trailingstoploss orders into your trading strategy on Binance, you can significantly enhance your risk management and trading efficiency in the crypto space. Remember to set appropriate trailing percentages, keep a close eye on market conditions, and utilize trailing stop-loss orders during trending markets or periods of volatility. However, it's essential to conduct thorough research, stay informed about market trends, and exercise sound judgment as trading cryptocurrencies always carry risks.
Remember, trading cryptocurrencies involves risks, and no strategy can guarantee profits. Always stay informed, keep learning, and make well-informed decisions when using trailing stop loss orders or any other trading tools on Binance or any other exchange.
When it comes to trading in the exciting world of cryptocurrencies, managing risk is crucial. One effective tool that can help you protect your gains and make informed trading decisions is the trailing stop loss order. In this article, we will explore how to use and determine the right time to employ trailing stop-loss orders specifically on the user-friendly Binance exchange.
Understanding Trailing Stop Loss Orders on Binance: Trailing stop loss orders on Binance are designed to adapt to market movements automatically. These orders allow traders to secure profits and limit potential losses as the market fluctuates. Binance provides an intuitive platform that empowers traders to take control of their risk exposure.
How to Use Trailing Stop Loss on #Binance
Trailing Stoploss
Choose Your Cryptocurrency:
Start by selecting the cryptocurrency you wish to trade and access the relevant trading pair on Binance.
Determine the Trailing Percentage:
Set the trailing percentage based on your risk tolerance and the unique characteristics of the cryptocurrency. A higher trailing percentage gives more room for market fluctuations, while a lower percentage tightens control.
Set the Initial Stop Price:
Establish an initial stop price that aligns with your risk appetite and analysis. This will serve as the starting point for your trailing stop loss order.
Keep an Eye on Market Conditions:
Regularly monitor market conditions and adjust your trailing stop loss order accordingly. In trending markets, consider tightening the trailing percentage to protect your profits. During highly volatile periods, widen the trailing percentage to account for market noise.
When to Use Trailing Stop Loss on Binance:
Take Advantage of Trending Markets: Trailing stop loss orders are particularly effective during trending markets. When a cryptocurrency shows a clear upward or downward trend, using a trailing stop loss can help you ride the trend while safeguarding against sudden reversals.
Managing Highly Volatile Cryptocurrencies: Some cryptocurrencies experience rapid price movements due to their inherent volatility. In such cases, trailing stop-loss orders can help you capture profits during upward swings while providing a buffer against sudden downturns.
Secure Your Trades During Absences: If you anticipate being away from your trading desk for an extended period, setting trailing stop loss orders can provide peace of mind. These orders adjust automatically based on market conditions, enabling you to manage risk even when you're not actively monitoring the market.
Conclusion: By incorporating #trailingstoploss orders into your trading strategy on Binance, you can significantly enhance your risk management and trading efficiency in the crypto space. Remember to set appropriate trailing percentages, keep a close eye on market conditions, and utilize trailing stop-loss orders during trending markets or periods of volatility. However, it's essential to conduct thorough research, stay informed about market trends, and exercise sound judgment as trading cryptocurrencies always carry risks.
Remember, trading cryptocurrencies involves risks, and no strategy can guarantee profits. Always stay informed, keep learning, and make well-informed decisions when using trailing stop loss orders or any other trading tools on Binance or any other exchange.
