A mistake I made myself: I didn’t understand this from the start.
The position size you calculate based on your stop-loss is unrelated to your leverage. Leverage only affects how much margin is required, but you need to make sure your liquidation price is beyond your stop-loss.
Set your stop-loss first, then calculate your position size based on the loss you’re willing to accept. That way, you know in advance how much you’ll lose on each trade that goes against you.
Coin mentioned in the topic: $BTC is trading at 81258.01 (24h -0.84%).
Have you run into a similar pitfall? Share your experience and help others avoid it.
#BTC
The position size you calculate based on your stop-loss is unrelated to your leverage. Leverage only affects how much margin is required, but you need to make sure your liquidation price is beyond your stop-loss.
Set your stop-loss first, then calculate your position size based on the loss you’re willing to accept. That way, you know in advance how much you’ll lose on each trade that goes against you.
Coin mentioned in the topic: $BTC is trading at 81258.01 (24h -0.84%).
Have you run into a similar pitfall? Share your experience and help others avoid it.
#BTC