Why always use Stoploss while trading?
Hi Everyone, Today, I am going to share my own experience related to Trading and what I have learned from my losses. Well, I am going to specifically talk about Crypto trading which I have started doing from last 10 days and the very first day I made a good profit as I was a beginner that's why for the learning purposes I was using only 5% ($10) amount of my portfolio investment. Even, I don't recommend you start your Leverage trading journey with the big amount and once you become experienced in it you can make a lot of money by doing only 1-3 trade in a day or in a week whenever you get the opportunity.
In the initial 3 days, I made a good profit and what a warm welcome it was in the space of Crypto Trading and everything was going good till the time, I start losing my trading amount. I am in the crypto investment field from the last 2 years and I was trading assets occasionally but due to lockdown, I started learning Intraday trading from the last 10 days. The learning process is truly amazing and when you implement it in real-world you will get real learning because just watching trading videos/strategy is useless until you are not implementing it in real life.
But the problem arises when I missed following the first rule of Intraday trading which is always using StopLoss and be active whenever your order took the position. Actually, my order was open but sadly I slept. lol...
And when I woke up I was I am in 15% loss+ lev loss, however, I was feeling relaxed I thought it would be okay after some time because I took place at 198-199 USD (ETH) and suddenly it broke it's major resistant and crossed 200 it was gradually increasing and I was in hope that it will come back sooner or later. This was not the first time it happened with me one more time when I was shorting ETH and again I got fucked up because I had no stop loss.
Here I was quite emotional and the big FOMO came into the market and suddenly it started booming. There were only 2 reasons for this FOMO One is Ethereum 2.0 and Bitcoin halving which we were waiting from last 1 year so that we can see BTC 10K+ and enter in the Bull run zone. Well, It wasn't a big loss as I was learning and exploring the Leverage trading because " A smooth sea never made a skilled sailor "
Nowadays, whenever I trade, I trade like a robot and it must have a strict Stop loss and my eyes on the Trading portal. I am trying to cover it and trying to be a complete robot so. lol... The best thing about StopLoss is at least it will save you from making your portfolio zero, I highly recommend you to use stop-loss whenever you trade no matter how active you are the market can change sentiments anytime and decide how many % profits you want so that you can take exist as soon as you reach to your target. Once you reached your target just shut down your screen and go hang out with friends and family.
This is an important topic... For some reason, I never like stop-loss, simply because it makes me feel as if I lose so much when they do this "wannabe dumps", simply to get all those stop-losses activated, only for the coin to pump more on later.
I know, it is stupid and I should probably use it, but I rather set my sell targets when buying, and then I sell no matter what when it reaches that level, meaning that I don't move my stop loss, because I don't have any.
Well, it seems quite insane but I like that you are already set a target which allows you to make a profit and not worry about stop-loss but still, I would recommend you to go with that.
Cheers and Happy Trading :-)
In general it is always great to use stop losses while trading but not always.
Some years ago I was big into trading warrants on traditional exchanges and I got a very bad experience with stop losses. On warrants there is most of the time a market maker that sets a price for sale and for buy. Since the price of a warrant is defined by the underlying stock or commodity, the market maker adapts the prices constantly. I believed that a stop loss would protect me from big drop in prices on these warrants. The problem is that these stop loss orders are only executed when there is a transaction on the market.
There was a huge drop in the underlying asset and the warrant lost about 90% of its value. My stop loss was set at 10% under the price of the previous day but it was not executed because there was no transaction on the market. Before using stop loss orders I would always make sure that the market is liquid and that there are transactions, otherwise the stop loss won't work.
Yes, I do agree with you even I have also faced this problem when my order did not execute after hitting the stop loss. Many Times stop-loss fail in case of high volatility in the market.
I agree that stop-loss is very important for intraday trading. Although, it doesn't always save you. You need to analyse different things and I have been caught out a few times with stop-loss where a coin had declined but in reality, it was just a bounce of my stop-loss position. Understand a good position to set the stop-loss at is important.
Yes, I agree with you because it happened to me as well when my order doesn't execute even after hitting the stop loss price.
Well my dear @amar15,
I should have read this article before yesterday.
The truth is I know about it but I am just too greedy 😂.
Sincerely,
@vlemon
@vlemon
Don't be greedy Man. Use stop-loss lol..
@amar15 stoploss is very important , as without that you are just risking your whole capital, one should always keep a stoploss.
Yes Man,
I realized this after this loss. lol...
Nice article about stop loss. We should actually trade like bot with no emotional thoughts because this way we end up doing wrong trade. Stop loss is always a nice option to control the loss.
Thank You and even I end up with loss and wrong decision many times but now I am a completely robot
Resteemed already. Upvote on the way :)
ps. you seem to be posting only on Steemit. So, perhaps you could check out this post and drop your own feedback:
https://steemit.com/hive-175254/@project.hope/discussion-best-way-to-handle-community-curators-program-requirements-starting-1st-of-may
Yours, Piotr
Thank You & I will read about it :-)
Thank You & I will read about it :-)
Resteemed already. Upvote on the way :)
Thank you so much & I really appreciate it :-)
@tipu curate
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@tipu curate