The cryptocurrency market is known for its high volatility, which can generate both large profits and quick losses. Therefore, risk management tools are essential. One of the most used is the Trailing Stop.
📌 What is a Trailing Stop?
The trailing stop is a special type of stop-loss order that automatically adjusts as the price of the asset moves in your favor.
👉 If the price rises, the stop also rises.
👉 If the price drops, the stop does not follow, ensuring the protection of profit or limiting the loss.
Unlike a fixed stop-loss, it adapts to market movements, helping the trader maximize gains and protect capital.
📊 What percentage to use?
There is no single number, as it all depends on the asset's volatility and the investor's profile.
👉 Conservative: usually use 5–10%, to minimize losses as much as possible.
👉 Moderate: prefer something around 10–15%, considered balanced by experts like consultants from BYDFi (bydfi.com).
👉 Aggressive: risk 15–20%, giving more room for fluctuations, but running the risk of larger losses.
📚 According to Cryptohopper (cryptohopper.com), the most common range is between 5% and 20%, adjusted according to the asset and strategy.
💡 Practical example
Imagine that you buy an asset for R$ 1 000 and set a trailing stop of 10%.
👉 If the price rises to R$ 1 200, the stop rises to R$ 1 080 (10% below the new peak).
👉 If the price drops and hits R$ 1 080, your position is sold automatically, securing part of the profit.
This mechanism helps avoid the need to monitor the chart 24/7 and brings emotional discipline to trading.
⚠️ Conclusion
The trailing stop does not eliminate market risks, but it is a powerful tool to lock in gains and limit losses. The percentage choice should always respect your risk tolerance and the volatility of the traded currency.