#SpotVSFuturesStrategy

The Stop Loss Problem

The Stop-Loss Problem

Retail traders frequently see their positions liquidated just before price moves in their favor.

💡This happens because:

- Whales and algorithms specifically target clusters of stop-loss orders

- Crypto's natural volatility triggers SLs too early

- Exchange liquidity systems profit from these liquidations

A Smarter Approach

1. Replace tight stops with strategic averaging:

- If you'd normally set a SL at $590, place your ENTRY there instead

- Add to your position if price drops further (e.g., at $580)

- This turns volatility into an advantage

2. For futures traders:

- Use much wider stops beyond obvious liquidity zones

- Reduce leverage to survive volatility

3. Psychological adjustment:

- Accept that 10-15% swings are normal in crypto

- Focus on longer timeframes where stop-runs matter less

Practical Example

Instead of:

"Buy BNB at $600, SL at $590"

Try:

"Buy BNB at $590 (would-be SL level), add at $580"

Why This Works Better

- Avoids predictable liquidition zones

- Lowers your average entry price

- Matches crypto's natural volatility

- Reduces emotional trading decisions

Final Thought

The best "stop-loss" is often no stop-loss at all - it's proper position sizing, patience, and strategic averaging. In crypto's manipulated markets, the less predictable you are, the more you survive.

What's been your experience with stop-losses? Have you found better alternatives?