The most common Stop Loss: when the price falls to or below the price you set, the system closes the transaction. For example:
- You buy 1 ETH for $100 and set Stop Loss of -10%, at $90;
- You enable Stop Loss;
- You select a convenient Price follow method — see which method to choose here;
- ETH trades for a while at around $100 but then begins to fall. At a certain time, the price reaches $90 and the system sells your ETH on the market.
Stop Loss is used primarily to limit possible losses. Some traders also use it in already profitable trades so that, if the price falls, the profit won’t be lost or the position will close at 0.