Two main methods are available to choose from. If you carefully read the descriptions of the Bid and Ask methods in this section, especially the examples, you might think that you should select Bid for Take Profit and Ask for Stop Loss. This is generally true, but not always.

Stop Loss

For example, you enabled Stop Loss on Ask. The price slowly approaches your Stop Loss and then a so-called dump occurs – a large sale (or several sales). Here, the Ask price is still higher than Stop Loss, while the Bid price is much lower. After this, the price recovers and rises. In this case you’re glad you selected the Ask and the market did not throw you out before the rise, leaving you with a large loss. Imagine that after this happens you start setting Stop Loss to -10% on Ask all the time. And then one day, the same kind of large sale happens, except that the coin does not rise after the fall, but falls even more. After the first sale, the Bid price dips below your Stop Loss and reaches -12%, and the ASK price hovers at -8%. The transaction remains open. A second large sale occurs, and this time the Ask price drops to -13%, while the Bid price drops to -19%. Stop Loss activates and your transaction closes on the market. What is the result? You have a loss of 19% instead of the 12% you would have had if you had chosen the Bid determination method. As you see, this is a double-edged sword. There is no ideal option; you need to choose according to personal preferences and risk levels. Either you risk being thrown out of the market prematurely, or you risk a greater loss.

Take Profit

At present, we recommend you choose Bid for Take Profit. The explanation is simple: if someone makes a huge purchase and the price on the sales book increases by +20%, the closing will still be according to the buys book, where the profit at this time may be only +5%.

Did this answer your question?