One of the most used orders in our scalping operations in Cryptocurrency Futures is the Trailing Stop Loss, and this basically has as main objective to protect the benefits in an operation performed, when we apply the Trailing Stop we are maximizing said benefits.
When the asset moves in our favor and the price rises we can apply the profit taking in the same way. There are two ways to maximize our profits in an operation: Using the Trailing Stop loss manual placing our order below a rebound in a support or in a resistance.
Another way is what we call sail by candle, that is, placing the stop below the bottom of each sail, this is used a lot in scalping. The second way is trough automatic Trailing Stop, and the synapsebot platform is a good way to make this kinds of trailing stop.
Very common mistakes when applying the Trailing Stop loss
These are the errors that we must avoid when applying this technique in any asset where we operate:
- Move the Stop against us, that is, if the price is returned, we take the order and move it away from it
- Let the price go in our favor and not place the order in a disciplined manner where it should be
- Do not plan our tickets and the points where we would place our stop
- Enter very volatile markets without adequate knowledge
- Not knowing our trading platform and not having practiced
Where can I apply the Trailing Stop loss manual?
You can make Trailing Stop manually in any platform since you only need to use your Stop loss order. The different trading platforms of Stock Exchange, Forex, Futures or Cryptocurrencies allow you to use this technique to reduce losses and maximize profits.
Although in platforms such as Binance, Bittrex or Poloniex it is sometimes complex to manage this technique, with practice you can achieve total mastery.
Appling Trailing Stop loss on high frequency platforms
Firstly we need to talk about the concept of automatic Trailing Stop loss. And this why? The market for cryptocurrencies is new, the traders that operate in it know very basic concepts such as only operating on the upside. This concept is known because exchanges like Binance are exchange and cannot generate money down.
Lately there have appeared platforms where you can operate both upwards and downwards, in addition with leverages. The concept of leverage allows the trader to have greater benefits as well as large losses.
Then already knowing concepts like leverage and that you can operate and earn money in two ways:
- Upward or also called Long
- Downward commonly known as Short or Short
- They are two types of concepts with which we can familiarize ourselves in the Cryptocurrency Trading
And why do I talk about these concepts? It is very simple, if we want to live from Trading, to be consistent and achieve lasting returns we must:
- Know the different market scenarios and know how to take advantage of them.
- Be flexible both when the price goes up and down.
- Adapt to any situation that arises and take action.
- Know how to manage our capital and our emotions.
- To know in depth the platforms where we will operate in these different market scenarios.
Many people wonder how these concepts can be applied to High Frequency Trading. And every day technology advances, trading algorithms become more sophisticated and as human operators we have too many disadvantages.
How does Trailing Stop loss work on Synapsebot?
Synapsebot is a platform designed for high frequency trading; we must be prepared to face sophisticated algorithms. There are several orders to facilitate our operations, one of which is the Trailing Stop.
As its name indicates, Trailing dragging, Stop = loss, allows us to automatically manage the protection order. This will allow us to maximize our profits in two possible price scenarios: When we enter a Long or Short operation and the price go in our favor. At the moment there is a price explosion and we want to take profits quickly.
Basically to have this order we will have the ease of making an entry in any operation. This way we will have the peace of mind that the Trailing Stop will do the work for us.