One $ETH hourly candle this week had a 7.9% high-to-low range. Where was your stop?
Most stop-losses don't fail because the idea was wrong. They fail because they were placed inside normal noise.
Quick numbers from the last 7 days of 1h candles on Binance spot:
• ETH: average hourly range 0.79%, widest 7.91%
• $BTC: average 0.57%, widest 3.58%
• $SOL: average 0.91%, widest 4.89%
A 1% stop on SOL is barely one average hour of movement. That's not risk management, that's a coin flip with fees.
How I'd think about stops instead:
1. Put the stop where your idea is invalidated (below a real level, like the 7-day low), not at a round % that feels comfortable.
2. If that level is far away, shrink the position. Distance to stop decides size, not the other way around.
3. Check the recent range first. ETH's 24h range alone is about 3.2% right now.
4. Never move a stop further away once you're in. Tighten, don't widen.
5. Accept that a good stop will still get hit sometimes. That's the cost of staying in the game.
What's your rule: fixed %, structure-based, or ATR?
Not financial advice.
#RiskManagement #TradingTips #Crypto
Most stop-losses don't fail because the idea was wrong. They fail because they were placed inside normal noise.
Quick numbers from the last 7 days of 1h candles on Binance spot:
• ETH: average hourly range 0.79%, widest 7.91%
• $BTC: average 0.57%, widest 3.58%
• $SOL: average 0.91%, widest 4.89%
A 1% stop on SOL is barely one average hour of movement. That's not risk management, that's a coin flip with fees.
How I'd think about stops instead:
1. Put the stop where your idea is invalidated (below a real level, like the 7-day low), not at a round % that feels comfortable.
2. If that level is far away, shrink the position. Distance to stop decides size, not the other way around.
3. Check the recent range first. ETH's 24h range alone is about 3.2% right now.
4. Never move a stop further away once you're in. Tighten, don't widen.
5. Accept that a good stop will still get hit sometimes. That's the cost of staying in the game.
What's your rule: fixed %, structure-based, or ATR?
Not financial advice.
#RiskManagement #TradingTips #Crypto