#StopLossStrategies
### **What is a Stop-Loss?**
A **stop-loss** is an order that automatically sells your crypto if the price drops to a certain level. It’s a risk-management tool that helps protect your capital by limiting losses when the market moves against you.
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### **Why Use a Stop-Loss?**
- Crypto is *highly volatile* — prices can drop fast.
- Emotions can lead to bad decisions.
- Stop-losses remove emotion and automate discipline.
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### **Common Stop-Loss Strategies**
#### **1. Percentage-Based Stop-Loss**
You set a fixed % below your entry price.
- Example: You buy SOL at $130. You set a 10% stop-loss at $117.
- If SOL hits $117, the trade automatically closes.
**When to use**: When you're swing trading or setting wider stops for volatile coins.
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#### **2. Support Level Stop-Loss**
You place your stop-loss just below a technical support zone.
- Example: If SOL has strong support at $120, place your stop-loss at $118–$119.
**When to use**: If you're trading with technical analysis and want to give your trade some breathing room near key levels.
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#### **3. Trailing Stop-Loss**
This adjusts automatically as the price moves up, locking in profits.
- Example: You set a 10% trailing stop on SOL. If the price goes from $130 to $140, your stop-loss trails up to $126.
- If SOL then drops to $126, it sells and locks in gains.
**When to use**: When you want to ride a trend but protect profits on the way down.
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#### **4. Volatility-Based Stop-Loss**
This method adjusts based on how volatile the asset is.
- High-volatility assets = wider stop-loss
- Low-volatility assets = tighter stop-loss
