Stop Loss
An automatic order that sells your cryptocurrency if the price drops to a specified level, limiting losses.
Explained Simply
A stop loss order automatically sells your position if the price falls to a preset level. It is a risk management tool to prevent catastrophic losses. For example, if you buy Bitcoin at $90,000, you might set a stop loss at $80,000 to limit your maximum loss to ~11%. Stop losses are not guaranteed to execute at the exact price (gaps can occur), but they automate discipline. Not all exchanges offer stop losses — check before trading. Use them as part of a broader risk management strategy.
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This content is for educational purposes only and does not constitute financial, tax, or legal advice. Always consult a qualified professional for advice specific to your situation.