The Vibe: An automatic sell order that triggers when price hits a level you set — protects you from big losses by getting out early.
The Details: A stop-loss (or stop order) is a pre-set price where your position sells automatically if the market moves against you. Example: You buy BTC at $60,000 and set a stop-loss at $55,000 — if price drops to $55,000, it sells to limit your loss (~8%). Types:
- Market stop-loss: Sells at the next available price (fast but can slip in volatility).
- Limit stop-loss: Sells only at your exact price or better (safer but may not execute).
Stops are essential in leveraged/perps trading to avoid liquidation — most exchanges (Binance, Bybit) support them. Trailing stop-loss is a dynamic version that follows price up.
Pro Tip: Always set a stop-loss when entering a trade — never “hope” it turns around. Place it below support levels or 5–10% below entry (adjust for volatility). Avoid tight stops in choppy markets (gets hit too easily). Combine with price targets for balanced exits.