#Education ✍️
💡 Stop-Loss: Why It’s Important and How to Use It
A stop-loss is your shield against unexpected losses. It automatically closes your position if the market moves against you.
📌 Why do you need it?
Without a stop-loss, you risk losing everything. Never open trades without setting one.
📌 Where should you place it?
Don’t just place your stop-loss anywhere. It should be set beyond a key support or resistance zone, ideally behind a liquidity grab or manipulation.
Here’s an example of two scenarios:
• In one, the stop-loss is placed beyond a support level after liquidity has been taken. If the price corrects, the chances of holding the position are high.
• In the other, a tight stop is set, which often leads to quick losses for most traders. The Binance CEO sees these stops and, as usual, sweeps them up before sending the price straight to the take-profit level. 🤣
🤝 Pro Tip:
Set your stop-loss behind a support or resistance zone visible on the chart, not in a random empty space.
💡 Stop-Loss: Why It’s Important and How to Use It
A stop-loss is your shield against unexpected losses. It automatically closes your position if the market moves against you.
📌 Why do you need it?
Without a stop-loss, you risk losing everything. Never open trades without setting one.
📌 Where should you place it?
Don’t just place your stop-loss anywhere. It should be set beyond a key support or resistance zone, ideally behind a liquidity grab or manipulation.
Here’s an example of two scenarios:
• In one, the stop-loss is placed beyond a support level after liquidity has been taken. If the price corrects, the chances of holding the position are high.
• In the other, a tight stop is set, which often leads to quick losses for most traders. The Binance CEO sees these stops and, as usual, sweeps them up before sending the price straight to the take-profit level. 🤣
🤝 Pro Tip:
Set your stop-loss behind a support or resistance zone visible on the chart, not in a random empty space.