🔒 What is a Stop Loss in cryptocurrencies?

A stop loss is a protection tool used by traders to set an automatic exit point from a trade in case the price moves against their expectations, thus reducing losses.

Simplified example:

Suppose you bought ETH at a price of $2,500

and you expected it to rise, but you don't want to lose more than 5%.

You set a stop loss at $2,375.

If the price drops and reaches $2,375, the coin is automatically sold to reduce your loss.

The goal? Protect your capital and not let emotion control your decisions.