I get asked: If the price returns to my average entry price, why am I still not breakeven?
I usually answer: Adding to a long position at a price below your average entry price lowers your average, but it also increases your position size, so a pullback of the same magnitude results in a bigger loss. The breakeven price is the price at which you truly break even after accounting for fees and funding payments: for a long position, it’s generally slightly higher than the average entry price; for a short position, slightly lower.
$BTC 83336 (+1.2%)
Have you ever misunderstood this?
#BTC
I usually answer: Adding to a long position at a price below your average entry price lowers your average, but it also increases your position size, so a pullback of the same magnitude results in a bigger loss. The breakeven price is the price at which you truly break even after accounting for fees and funding payments: for a long position, it’s generally slightly higher than the average entry price; for a short position, slightly lower.
$BTC 83336 (+1.2%)
Have you ever misunderstood this?
#BTC