MooKing Practical Teaching｜Bitcoin Flash Crash: How to Set Stop Loss to Avoid Being Swept Away by "False Dips"?
The Binance K-line chart has been super exciting these days, with $BTC plunging within just a few minutes. Many new investors have the biggest question: How should I set my stop loss so that I won't be swept away immediately?
👉 Simple analogy: A stop loss is like a seatbelt. If it's too tight, you get uncomfortable when the car sways; if it's too loose, you can't save your life when an accident really happens.
📈 Professional trading thought process:
It is recommended to use "ATR (Average True Range)" as a reference and set the stop loss slightly wider than recent volatility.
Do not invest all your capital at once; divide your funds into batches to reduce the risk of being swept away all at once.
Strictly control leverage; otherwise, you might get liquidated before your stop loss can even trigger.
Someone in the community joked: "My stop loss is set by the exchange—it's called liquidation." In fact, this highlights the importance of risk management.
As for me, MooKing, I prefer the strategy of "wide stop loss + small position"; I'd rather keep the green mountains than suffer total defeat in one go. Do you usually set stop losses? Or do you just leave it "Buddhist-style"?
A drop is a buying opportunity!!
See you next time in the small classroom #MooKing !
