Trader’s glossary: Stop Loss
📌‼️ SL (Stop Loss) is one of the main trading tools. It allows to limit your losses if a negative scenario occurs.
✔️ In fact, it’s a sell order, which trader can set according the minimal acceptable price. For example, if you buy XVG for 487 satoshi (expecting the coin to increase in value), the Stop Loss should be set onto several points below the purchase price. That way you will not accidentally waste everything in a case of a sudden rate fluctuation.
✔️The calculation of Stop Loss depends on positions you trade: short, middle or long. According the general recommendation, the maximal risk of any bargain should not exceed 10%.
Usually Stop Losses are set by following metrics:
⭕️ A little bit upper/lower the previous low.
⭕️ A little bit upper/lower the fractals
⭕️ A little bit upper/lower Parabolic SAR
⭕️ A little bit upper/lower Moving Average
‼️ PLEASE, NOTE! ‼️ Never set Stop Loss onto valuable levels. The market will test the level once again, and you will be left with a lesion.
Trade rationally, dear friends! ‼️💹
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