Altrady's Trailing Stop Orders Part 1: An Introduction
Part 1: An Introduction
Purpose
Altrady’s Trailing Stop Orders
Trailing Stop Order Components
Example 1. Trailing Stop Buy
Example 2. Trailing Stop Sell
See also: Altrady's Trailing Stop Orders Part 2: Placing and Executing Orders
Video: Take Profit and Trailing Stop Orders
When you see a chart like this, do you wonder how you can catch those big moves?
Or perhaps you know roughly where you’d like to place your Take Profit orders, but would like to catch a few more percentage points if possible.
Or get a better entry than you could by estimating how far down (or up) a pair might go with the next BTC dump?
The Trailing Stop order can allow the trader to gain higher profits in all of these situations. Once activated, the Trailing Stop follows the price as it moves further in the desired direction, until the price begins to move in the opposite direction (retrace). Once the price has retraced a certain percentage (chosen by the trader), the order will fill.
The Trailing Stop follows the price as it rises (or falls), and places an order once the price has retraced by the percentage the trader specifies.
The Trailing Stop only moves in one direction: lower for a Buy and higher for a Sell. A Trailing Stop of 5% on a Sell order will track the price as it moves higher, and when the price has retraced by 5%, the Stop Limit order will be placed.
Altrady offers these Trailing Stop orders:
--Limit Trailing Stop as an order entry, to get the best buy or sell price.
--Limit Trailing Stop an exit for coins you already own, to gain a better Take Profit price (also known as Trailing Take Profit).
-- A Trailing Stop will be added soon as an exit option for All-in-One trades.
To use Altrady’s Trailing Stop order, the trader sets three figures:
--the price to start trailing--known as the Trigger Price. This can be the Current Price if trailing is to start immediately.
--How much can the price retrace before the order is placed? This is called the Stop Percentage and is used to calculate the Stop Price. Retraces of less than the Stop Percentage will not trigger order placement while retraces greater than the Stop percentage will.
--When the Limit Order is placed, how much leeway should be given to make sure the order is filled? The Limit Percentage is used to calculate the Limit Price.
For suggestions on where to set these values, see Altrady's Trailing Stop Orders Part 2: Placing and Executing Orders
The images below show how Altrady’s Trailing Stop works, and the relationship between the Trigger price, Stop Price, Limit Price and Current Price.
An example Trailing Stop Buy, with:
Trigger price = 100
Stop % = 9% (will trail at 9% above the trigger/low price)
Limit % = 10% (will trail at 10% above the trigger/low price).
In this example, the current price starts at 110, and the Trailing Stop won’t be triggered until the price reaches 100.
Once triggered, Altrady will track the current price, and whenever it makes a new low, the Trailing Price will be updated and the Stop Limit order is placed on the exchange at the new level.
Data for Example 1:
The animation below shows how the Stop and Limit prices move down once the Trigger price is reached and each time a new low price is reached.
When the current price moves ABOVE the Stop Price, the Limit Buy is placed. In this example, when the current price reaches 90, it is above the Stop Price of 88.29, and the Limit Buy order is placed at 89.10. If there are better Ask prices in the Order Book when the Limit Buy is placed, the order will be filled at those prices.
An example Trailing Stop SELL, with:
Trigger price = 100
Stop % = 7% (will trail at 7% below the trigger/high price)
Limit % = 8% (will trail at 8% below the trigger/high price).
In this example, the current price starts at 90, and the Trailing Stop won’t be triggered until the price reaches 100.
Once triggered, Altrady will track the current price, and whenever it makes a new high, the Trailing Price will be updated and the Stop Limit order is placed on the exchange at the new level.
Data for Example 2:
The animation below shows how the Stop and Limit prices move up once the Trigger price is reached and each time a new high price is reached.
When the current price moves BELOW the Stop Price, the Limit Sell is placed. In this example, when the current price reaches 102.2, it is below the Stop Price of 102.30, and the Limit Sell order is placed at 101.20. If there are better Bid prices in the Order Book when the Limit Sell is placed, the order will be filled at those prices.
See also Part 2:
Altrady's Trailing Stop Orders Part 2: Placing and Executing Orders
____________________________________________
New version 4th September, 2021
Purpose
Altrady’s Trailing Stop Orders
Trailing Stop Order Components
Example 1. Trailing Stop Buy
Example 2. Trailing Stop Sell
See also: Altrady's Trailing Stop Orders Part 2: Placing and Executing Orders
Video: Take Profit and Trailing Stop Orders
Purpose
When you see a chart like this, do you wonder how you can catch those big moves?
Or perhaps you know roughly where you’d like to place your Take Profit orders, but would like to catch a few more percentage points if possible.
Or get a better entry than you could by estimating how far down (or up) a pair might go with the next BTC dump?
The Trailing Stop order can allow the trader to gain higher profits in all of these situations. Once activated, the Trailing Stop follows the price as it moves further in the desired direction, until the price begins to move in the opposite direction (retrace). Once the price has retraced a certain percentage (chosen by the trader), the order will fill.
The Trailing Stop follows the price as it rises (or falls), and places an order once the price has retraced by the percentage the trader specifies.
The Trailing Stop only moves in one direction: lower for a Buy and higher for a Sell. A Trailing Stop of 5% on a Sell order will track the price as it moves higher, and when the price has retraced by 5%, the Stop Limit order will be placed.
Altrady’s Trailing Stop Orders
Altrady offers these Trailing Stop orders:
--Limit Trailing Stop as an order entry, to get the best buy or sell price.
--Limit Trailing Stop an exit for coins you already own, to gain a better Take Profit price (also known as Trailing Take Profit).
-- A Trailing Stop will be added soon as an exit option for All-in-One trades.
Trailing Stop Order Components
To use Altrady’s Trailing Stop order, the trader sets three figures:
--the price to start trailing--known as the Trigger Price. This can be the Current Price if trailing is to start immediately.
--How much can the price retrace before the order is placed? This is called the Stop Percentage and is used to calculate the Stop Price. Retraces of less than the Stop Percentage will not trigger order placement while retraces greater than the Stop percentage will.
--When the Limit Order is placed, how much leeway should be given to make sure the order is filled? The Limit Percentage is used to calculate the Limit Price.
For suggestions on where to set these values, see Altrady's Trailing Stop Orders Part 2: Placing and Executing Orders
Example 1. Trailing Stop Buy
The images below show how Altrady’s Trailing Stop works, and the relationship between the Trigger price, Stop Price, Limit Price and Current Price.
An example Trailing Stop Buy, with:
Trigger price = 100
Stop % = 9% (will trail at 9% above the trigger/low price)
Limit % = 10% (will trail at 10% above the trigger/low price).
In this example, the current price starts at 110, and the Trailing Stop won’t be triggered until the price reaches 100.
Once triggered, Altrady will track the current price, and whenever it makes a new low, the Trailing Price will be updated and the Stop Limit order is placed on the exchange at the new level.
Data for Example 1:
The animation below shows how the Stop and Limit prices move down once the Trigger price is reached and each time a new low price is reached.
When the current price moves ABOVE the Stop Price, the Limit Buy is placed. In this example, when the current price reaches 90, it is above the Stop Price of 88.29, and the Limit Buy order is placed at 89.10. If there are better Ask prices in the Order Book when the Limit Buy is placed, the order will be filled at those prices.
Example 2. Trailing Stop Sell
An example Trailing Stop SELL, with:
Trigger price = 100
Stop % = 7% (will trail at 7% below the trigger/high price)
Limit % = 8% (will trail at 8% below the trigger/high price).
In this example, the current price starts at 90, and the Trailing Stop won’t be triggered until the price reaches 100.
Once triggered, Altrady will track the current price, and whenever it makes a new high, the Trailing Price will be updated and the Stop Limit order is placed on the exchange at the new level.
Data for Example 2:
The animation below shows how the Stop and Limit prices move up once the Trigger price is reached and each time a new high price is reached.
When the current price moves BELOW the Stop Price, the Limit Sell is placed. In this example, when the current price reaches 102.2, it is below the Stop Price of 102.30, and the Limit Sell order is placed at 101.20. If there are better Bid prices in the Order Book when the Limit Sell is placed, the order will be filled at those prices.
See also Part 2:
Altrady's Trailing Stop Orders Part 2: Placing and Executing Orders
____________________________________________
New version 4th September, 2021
Updated on: 11/06/2024
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