Trade like an Expert with a Take Profit Order on the Best Automated Trading Platform
by Trailing Crypto cryptocurrency expertsWe all can agree that
popularity of crypto trading market is its volatility and this is the key
factor behind any trading strategy. Having the risk tools to manage risks and
execute crypto trades is quite important for a seasoned pro or new trader. The
crypto trading platforms like TrailingCrypto offers a wide range of crypto
trading tools and advanced order types to traders.
Different kinds of
strategies for securing profits and averting losses have been proposed by the
crypto traders, which usually involve the prices at which a position was
opened, and are used by the traders as well as the automated trading systems
frequently. Profit targets are the most important part of crypto trading
strategies. It is not the entries where you earn profits, but you need to choose
the exit strategy smartly.
Choosing a profit
target is important and requires you to work out in advance. It requires you to
prepare for the risks and rewards. There are countless ways where you can set
your profit target using technical indicators and other tools. Among these
order types, Take
Profit order is gaining huge popularity and is quite beneficial for
traders in all ways. Let’s understand about this order:
Take Profit
This is one of the
most important risk management tools used by the crypto traders on a daily
basis. Take profit order in crypto trading mentions the specific price at which
a trader should close an open position for a profit. Most of the crypto traders
employ take profit order combined with stop loss orders so as to manage their
open positions.
This order is actually
an automatic exit strategy based on the profit and loss calculation. Placing a
take profit order requires a technical analysis of the market moments. And, if
you are a trader with short-term strategy who wants to enjoy the benefits of
sudden rise in the price of asset, this order type is quite useful.
In this order type,
the trader chooses a take profits value as the appropriate amount in case the
trade moves in the favor of a trader. If that particular level of profit is
reached or once the T/P order is triggered, the trade will be closed
automatically. Take profit order is a kind of pending order that locks in the
trader’s profit automatically and lets traders earn immediate profits.
Take-Profit orders can
help traders lock in a profit by automatically closing a position if the price
moves favorably. This order can also be placed if the user does not have an
open position.
Let’s understand about
this order with an example:
Suppose a trader buys
a stock XYZ at $5,000, and puts take profit value as +10% which means, he has
created an order to sell XYZ at a price of $5,500.
For some time, the
stock XYZ has traded within the range of $5,000, and then continued to grow.
Upon reaching the value of $5,500 or above, your pending order with take profit
+10% will be fulfilled, and the system will close the trade as a sell order.
In this case, the
total profit value comes out as $500.
Placing Take profit
order via automatic trading platform
The automatic crypto
trading platform allows traders to place trades automatically by automating
their profit targets and stop losses. Making use of crypto trading bot is the
best way to manage your positions.
Crypto
trading bots allow traders to
place orders based on the preset strategies or algorithms. The best trading
platforms like TrailingCrypto allow its traders to customize their trading
strategy by their own.
This order type is
designed to manage risks whenever the system will stop the bot and sell the
order used by the trader in open orders as soon as the specified conditions for
the take profit order are met. Once the bot reaches the specified percentage
set by you in the take profit parameters, it stops trading by selling the asset
at the base price.
To activate Take
profit, you have to set the TP %.
Example:
Suppose, you have an
active bot set on the crypto trading platform which is trading on ETH/USDT, and
you set the Take profit at
15%. As soon as the current price of the ETH (In USDT) becomes +15%, the bot
will close all the orders automatically, and sell the remaining ETH.
To use a take profit
order, day traders establish a price at which they want to sell the asset. This
price is one sufficiently above the price at which the crypto asset was bought
to ensure that traders will make a profit on the sale. Once the take profit
point preset by the trader is reached, the order is triggered and the sell
order goes through at that day’s current market value. If that point isn’t
reached, the sell order is not executed, and the trader holds on to the asset.
Advantages of placing
take profit orders
While no one among us
can predict exactly which trades will go well, but we can earn profits by take
profit order by presetting your strategy via trading bots. The advantage of
take profit orders is that the trader is not required to execute any trade
manually. This order type is executed at the best available price in the
market. This order is risk minimizing and profit taking.
While setting this
order type, the trader should consider risk to reward ratio which will show how
much profit the trader expects in any exchange. The best trading platforms
allow traders to test and automate their trading strategies. These platforms
have their own bots that watches the market 24x7 and place trades automatically
on behalf of the trader.
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Created on Feb 13th 2023 11:53. Viewed 139 times.