#StopLossStrategies Stop Loss Strategies That Prevent You from Getting Stuck Again at the Peak

Honestly, I used to be very stubborn about stop-loss. I felt confident that the price would bounce back, but in the end, I ended up getting stuck for months. From that, I learned that stop-loss isn't about 'giving up', but rather a survival strategy so I don’t sink deeper.

Now I have several stop-loss strategies that I use depending on the situation. The most common one I use is the percentage-based stop-loss. For example, if I buy coin A at $1, then I set a stop-loss 10% below, which is at $0.90. So if the price drops to that point, it sells automatically. This gives me a limit on the loss I can accept.

Then there is also something called trailing stop-loss. This is really cool. So the stop-loss follows the price movement. For instance, if I buy ETH at $2000 and set a trailing stop-loss at 10%. If ETH rises to $2500, the stop-loss also increases to $2250. But if ETH drops from there and hits $2250, it sells immediately. The advantage is that we can protect profits while still having a limit to avoid falling too deep.

I have also used support level stop-loss. So I look at the chart first, find the nearest support point. For instance, if support is at $0.80, I would set the stop-loss slightly below it, say at $0.78. If the price breaks the support, it usually continues to drop, so it's better to exit early.

For example, during the market drop at the beginning of 2022, I held ADA which I bought at $1.40. I set a stop-loss at $1.25 (about 10%). Sure enough, a week later it plummeted below $1. Fortunately, it sold at $1.25, so I only lost a little. If I hadn't used the stop-loss, I might still be stuck until now.

The point is, using a stop-loss is like having an emergency brake. We can't control the market, but we can control how much we are willing to lose. And most importantly, after hitting the stop-loss, don’t immediately seek revenge by buying again. Evaluate first, take a breath, then take the next step.