When holding a position in a perpetual futures, it is inevitable that there will be floating profits and losses as the price of cryptocurrency rises and falls. When the price rises, you may think that the price will continue to rise and not reduce your position to take profit, but you may miss out on the profit because the price falls. Or when the price falls, you may think that the price will bounce back soon, but the more it falls, the more it will trigger the forced closing of your position. Therefore, in the process of trading perpetual futures, the reasonable use of stop loss can reduce the risk of loss due to forced liquidation. On the other hand, you can lock earnings early.
What is Take Profit and Stop Loss (TP/SL)
Take Profit allows you to specify a price at which to execute an order when the price moves in a favorable direction. This helps increase the chance of closing a position and ensures a profit.
Stop Loss allows you to specify a price at which to execute an order when the price moves in an unfavorable direction. This helps to limit the maximum amount of loss on a position, control losses and avoid excessive losses.
Either Take Profit or Stop Loss can be used to set the market price for exit in advance, without having to watch the market closely to reach a target level before manually placing an order, and to reduce the impact of personal emotions, thus ensuring a minimum amount of profit or maximum loss on existing positions.
How to Set Up Take Profit and Stop Loss
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Log in to Bitunix.com, click “Futures” on the top of the page.
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Check the Take Profit Stop Loss box in the middle of the panel for placing orders. Then enter the price for take profit and stop loss. And enter the order price and amount and click buy.
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After successfully placing the order, you can view your TP/SL orders under Open Orders at the bottom of the page.
Disclaimer
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Crypto investment involves significant risks. Please proceed with caution. The course shall not be considered investment or financial advice.