Trailing stop loss and stop loss? For those of you who have entered the crypto world, surely the term loss is familiar!

How to use trailing stop loss and stop loss methods:

• Trailing Stop Loss

Has recently been used by traders to minimize losses. Trailing Stop Loss or TSL is a type of order that allows you to choose the maximum loss value or percentage in the transaction. TSL will move in the direction of the market trend, and the result of this technique is the highest profit, not from the entry price.

This TSL method is perfect for day trading! Because, TSL allows you to set the maximum value or percentage of losses that you can incur while trading.

If the market price goes up or down in your favor, the trailing stop loss price moves with it. However, if the market price rises or falls against your expectations, the trailing stop loss will remain the same.

For example, for every Bitcoin price that increases by $1, the TSL will also increase by $1. If the price moves up by $10, the trailing stop loss will also increase by $10. However, if the price starts to fall, the trailing stop loss does not move.

TSL aims to help you take advantage while avoiding bigger losses. TSL limits the risk of loss, but does not limit the potential profit that can be made if the price movement of the crypto asset continues to rise as expected. However, keep in mind that this technique does not protect you from market movements that are larger than the stop placement you choose!

This TSL is suitable to be applied when crypto assets are bullish, right! Not when the crypto asset is bearish or correcting. If you put it wrong, TSL runs the risk of causing a prolonged and premature cut loss. However, what is certain, the advantage if you use this TSL method is that TSL can help you lock in the profits that have been obtained automatically. So, you can use this method even if you didn’t take profit before.

This method is quite effective, you know, used in a trending market, because the movement will be in line with market prices and automatically stop when the trend changes direction. In addition, a TSL is initially placed in the same way as a regular stop loss order.

• Stop Loss

A stop loss order is a feature created by the platform to buy or sell a crypto asset when the price has reached a certain limit. This feature is also designed to minimize traders’ losses.

For example, a trader buys Bitcoin and places a stop-loss order 10% below the purchase price. Then, when the Bitcoin price drops, this order will be activated, and the Bitcoin will be sold as a market order.

There are already many traders who use this stop loss method for long-term or long-term trading. However, stop losses are also suitable for short-term trading, where the crypto assets you own will be purchased if the market price is above the price you have set.

The Stop Loss method will also maintain the crypto assets that you store. This strategy can maintain the initial value of the money you used to trade. In addition, stop loss also prevents the situation from going bad, and most importantly this stop loss method makes a profit, even if it is small.

Well, the main difference between stop loss and trailing stop loss is that the trailing stop method moves every time the price moves according to your wishes, and not for the stop loss method.