Binance Trailing Stop Loss

Are you looking to maximize your profits while trading on Binance? Then you need to know about the powerful tool called Trailing Stop Loss. In this article, we’ll explain what it is, how it works, and how you can use it to your advantage.

Understanding Trailing Stop Loss

A trailing stop is a modified version of a typical stop order that allows you to set a specific percentage or dollar amount away from the current market price of a security. For long positions, you would set a trailing stop loss below the current market price, while for short positions, you would set it above the current market price.

The purpose of a trailing stop loss is to protect your gains by allowing a trade to remain open as long as the price is moving in your favor. The order automatically adjusts as the price fluctuates, ensuring that you can continue to profit. Once the price reaches the trailing stop level, the trade is closed.

How it Works

Let’s understand the concept of trailing stop loss with an example. Imagine you bought a coin at a price of 100 and set the trailing stop loss at 90, 10 points below the buying price. If the price drops to 90, the stop loss will be activated, and the trade will be closed with a 10% loss.

However, if the price of the coin increases to 130, the trailing stop loss will automatically adjust to 120, 10 points below the current price. If the price then drops to 120, the trade will be closed automatically as the trailing stop loss is activated. If the price continues to rise, the trailing stop will move up accordingly, always maintaining a 10-point difference with the current price. In spot trading, you would need to manually adjust the trailing stop.

Please note that, currently, Binance only supports trailing stop loss for the Futures market. However, it is expected that this feature will be available for spot trading in the near future.

Binance Trailing Stop Loss

So, if you’re looking to maximize your profits and limit your losses while trading on Binance, the trailing stop loss feature is something you should definitely explore. Keep learning, keep earning! 😊