Stop-loss is the first survival skill for a trader.
But it’s not as simple as “set it and you’re done”—set it in the wrong place and you’ll end up cutting losses constantly.
Today, I’ll share 3 stop-loss setting principles that I’ve tested and found effective.
【Principle 1: Technical stop-loss takes priority over a fixed percentage】
Don’t set it as “run when down 10%”—first check where the key support level is.
For example, if BTC has strong support at 60,000, then stopping out at 59,000 is more reasonable than using 10%.
Only when support is broken is it a signal of a potential trend reversal.
【Principle 2: Give the stop-loss room to breathe】
Many beginners set their stop-losses too tight and get swept right after entering.
Stop-loss room = volatility × safety factor.
ETH is more volatile, so the stop-loss line can be wider; for stablecoin arbitrage, the stop-loss line can be narrower.
【Principle 3: Stop-loss in batches】
If you’re heavily positioned, don’t stop out all at once.
Use 3 batches: when the first stop-loss line is broken, cut 1/3; when the second line is broken, cut another 1/3; finally, keep the remaining core position and observe.
This controls risk while still preserving the possibility of a rebound.
A stop-loss isn’t admitting defeat—it’s leaving bullets for your next entry.
The market has risk; trade with caution.
But it’s not as simple as “set it and you’re done”—set it in the wrong place and you’ll end up cutting losses constantly.
Today, I’ll share 3 stop-loss setting principles that I’ve tested and found effective.
【Principle 1: Technical stop-loss takes priority over a fixed percentage】
Don’t set it as “run when down 10%”—first check where the key support level is.
For example, if BTC has strong support at 60,000, then stopping out at 59,000 is more reasonable than using 10%.
Only when support is broken is it a signal of a potential trend reversal.
【Principle 2: Give the stop-loss room to breathe】
Many beginners set their stop-losses too tight and get swept right after entering.
Stop-loss room = volatility × safety factor.
ETH is more volatile, so the stop-loss line can be wider; for stablecoin arbitrage, the stop-loss line can be narrower.
【Principle 3: Stop-loss in batches】
If you’re heavily positioned, don’t stop out all at once.
Use 3 batches: when the first stop-loss line is broken, cut 1/3; when the second line is broken, cut another 1/3; finally, keep the remaining core position and observe.
This controls risk while still preserving the possibility of a rebound.
A stop-loss isn’t admitting defeat—it’s leaving bullets for your next entry.
The market has risk; trade with caution.