3 myths about crypto trading tools

[mickaelmosse.cryptoadvise]

Let’s demystify the next three myths about crypto trading by Mickael Mosse’s explanations.

The stop-loss configuration is a not needed tool. False.

The configuration of the “stop-loss” is a vital order that traders can determine into their trading plan. Its function is to protect against losses of funds.

Mickael Mosse says, in the case of cryptocurrencies, this order is paramount thanks to their volatility. It means that the price of cryptos can go up right now, and in one hour, it could drop in a flash because of the market movement.

For example, you buy Bitcoin, and you place a stop-loss of 5% below the original purchase price. If Bitcoin drops during your operation, that stop-loss order gets activated. That crypto will sell as that order avoiding the loss of your bitcoins.

We agree that it is better to take a small loss today and continue trading “slowly but surely” tomorrow, than holding crypto that is losing value over time.


Technical analysis VS fundamental analysis, both are useful tools. True.

According to Mickael Mosse, traders use two different points of view to make their market movements:

Technical analysis, which involves knowing how to read a variety of indicators and market statistics.
Fundamental analysis refers to being informed about financial news and company numbers to make decisions from there.
Technical analysis is a way to evaluate investments and identify trading opportunities regarding price trends and patterns charts. In simple words, it is about analyzing statistics and data from the market to know when is the perfect moment to buy and sell assets and get profit from it, says Mickael Mosse.

Fundamental analysis is a method to determine if a stock’s value is fair enough compared with the market price. With this, a trader studies any factor affecting the asset’s security from the economic facts and flash financial or political news.

These elements can be contrasted or considered complementary to having a global perspective of the market, knowing the historical price patterns and stock trends, and reviewing a company’s financials and world economic view.

Take-profit set up is an additional. False.

Take-profit is a trading limit order that indicates the exact price to close out an open position to profit from it. It is a limit order because it closes when it reaches the specified profit level. It is, says Mosse, an excellent tool for traders who want to profit from a quick market bump in the short-term. In general, traders can decide about a stop-loss or a take-profit order depending on their level of training, experience, trading plan, and risk management, according to Mickael Mosse.
__________
By Mickael Mosse, Cryptocurrency and Blockchain Advisor
You can find more articles and advice about crypto, trading and blockchain on Mickaelmosse.com.

[boyptc]

Whoever says that stop-loss isn't needed must be an active trader and can quickly stop his losses whenever he has pending trades that are about to go in a loss.

Stop-loss has been helpful to me and just wait for some people to come and they'll say the same.

[stomachgrowls]

Let’s demystify the next three myths about crypto trading by Mickael Mosse’s explanations.

The stop-loss configuration is a not needed tool.


Technical analysis VS fundamental analysis, both are useful tools

Take-profit set up is an additional.

So lets just snip out those definitions and stick out on the real tools that had mentioned. So lets start with stop-loss which it isnt a needed tool?
It wont be created if it isnt useful but this could only be relevant to those who arent making active trades where these traders do make use of that mental stop
and doesnt need for any tool/SL to be used since they've been active on seeing price movement.For some who are always far away into their devices then
it would be a good option to take but it is indeed on someones reference.

Technical vs Fundamental? They are indeed both useful but to those news on this market isnt really that often but once it pops out then people do
commonly make out some presumptions.

TP/ Take profit - Just like SL when you are away or not really that much active on checking out your position then setting up this tool
is a relief but its cons will really be limiting out the profit to be made once its triggered and if the market price tends to shoot up
even more.Well, its better than have nothing at all.

[AliMan]

Whoever says that stop-loss isn't needed must be an active trader and can quickly stop his losses whenever he has pending trades that are about to go in a loss.

Stop-loss has been helpful to me and just wait for some people to come and they'll say the same.

Yeah we can really apply that certain kind of strategy specially when we're not having an assurance of the reachable value of our coin. Better use this method to prevent losing more amount of money. If you're doing good at it, then you'll be successful trader in the future once you've surpassed all challenges that might happen all day long. Some people who doesn't recognize stop loss usually failed, and most of them was a risk takers.

[chaser15]

It depends on how traders will use those:

1. Stop-loss won't be an advisable thing to do if it's not effective in the first place. If used properly, can be a big help.

2. Fundamentals and technical analysis are really a must but that doesn't mean traders have to always rely on that. It's like one of the best ingredients to make a perfect dish.

3. Take profit, like stop-loss, also need to be used properly.

Overall, these aren't myths but a good method.

[StephenJH]

Stop loss is useless for day traders because they can handle the profit/loss ratio by staring at the monitor and checking the hourly price candles on charts. For long-term traders, the situation is a bit different because having a stop loss will save the trades from the unplanned losses. Scalping and trading on small time-frames don't have the high-risk factors compared to big movements on daily charts.

Optimizing the loss/profit balance solely depends on the stop orders for wins and losses. Using the sell stop orders to buy more if the price crosses the resistance line is smarter than buying in the middle of the trend because the dust will be there. Noise makes it harder to find the direction but after the settled dust the clear direction will be a source of profit in trending markets.

[CaVO32]

It depends on how traders will use those:

1. Stop-loss won't be an advisable thing to do if it's not effective in the first place. If used properly, can be a big help.

2. Fundamentals and technical analysis are really a must but that doesn't mean traders have to always rely on that. It's like one of the best ingredients to make a perfect dish.

3. Take profit, like stop-loss, also need to be used properly.

Overall, these aren't myths but a good method.

Good methods that are useful when optimized properly. It also depends on the skill level of the trader. Those factors are important in their own ways and may help the trader in different circumstances. The situation of traders vary from one another. So it is how he will apply those skills and knowledge to attack his trading activities.

[Zemomtum]

Stop loss has saved me a lot more than and negativity that is associated with it. If your stop loss get triggered and the market moved back upward, it is still okay, you should think of what if the market continue to sink further. It is a good tool not to be ignored.

[maxreish]

Those who commented about stop loss not needed as a tool mislook the word FALSE Word beside that sentence. You've misunderstood the sentence and dont read the OP's whole explanation about it.
It means the opposite. Because we all needed that stop loss to prevent huge loss and rebuild profits while doing another trades.

While I won't disagree about the fact that the combination of TA and FA are very much essential and helpful when doing some trading, but it depends on a typical trader how to rightly read those tools. Sometimes we mistakenly read those that leads to our losses.

[DevilSlayer]

Stop loss is useless for day traders because they can handle the profit/loss ratio by staring at the monitor and checking the hourly price candles on charts. For long-term traders, the situation is a bit different because having a stop loss will save the trades from the unplanned losses. Scalping and trading on small time-frames don't have the high-risk factors compared to big movements on daily charts.

I do not agree to what you just said because for me stop loss is important, I'm a intra day traders where I usually scalp and make gains in just minutes or hours. Stop loss for me is part of my system and it is really advisable to use it. I never enter a trade without using a stop loss because it is part of risk management and every newbies who want to become a better trader should master it. I also do not agree to you when you said that small time frames are not risky, for me it is more risky than daily or weekly time frames because in daily and in weekly time frames the signals and the conviction that you can have is real and the data is really legit unlike in slow time frames there are a lot of invalidation and false signals.

For those who avoid losing huge amount of money, try to focus on managing your risks in trading by having and mastering the art of cutting losses. I think a lot of traders do not use it because they think that it is just a waste of time, for me it is not and we should really give care on it.

[michellee]

If you can not watch the market daily and are worried if the market can down anytime, you can apply the stop-loss, especially if the price's moving can not be predicted because the price can drop anytime without we know. By using the stop-loss, you can prevent a big loss, and you will have a chance to buy back bitcoin at a lower price.

The TA and FA are the tools that the trader will need to make their analysis. Based on the situation, they will have a chance to determine what they need to do. If the situations are not good to trade, they can cancel to trade on that day, and they will search for another time which can give them the profit.

If we talk about making a profit, not many traders will use their time to sell their coin and take profit because many traders will change their minds not to sell at the high price now, but they consider selling at another high price. They make a plan on when they can close the trade, but after the price can rally to the high price, they become greedy, making them miss the time to sell at the right time.

[palle11]

Stop loss has saved me a lot more than and negativity that is associated with it. If your stop loss get triggered and the market moved back upward, it is still okay, you should think of what if the market continue to sink further. It is a good tool not to be ignored.

Stop loss is important for a trader who wants to continue in trade because you need to have the account to trade. Someone can have pains when the stop loss hit you off. But at same time this should not make the stop loss to be criticized because it saves a lot of damage that could happen in the account.

[boyptc]

Whoever says that stop-loss isn't needed must be an active trader and can quickly stop his losses whenever he has pending trades that are about to go in a loss.

Stop-loss has been helpful to me and just wait for some people to come and they'll say the same.

Yeah we can really apply that certain kind of strategy specially when we're not having an assurance of the reachable value of our coin. Better use this method to prevent losing more amount of money. If you're doing good at it, then you'll be successful trader in the future once you've surpassed all challenges that might happen all day long. Some people who doesn't recognize stop loss usually failed, and most of them was a risk takers.

When you trade, you already took risk not only those don't do stop-loss.

The feature has been helpful for those that can't monitor their trades. It's better to lose a few than to lose a lot when you can't monitor it. Successful traders are good in stoppage or avoidance of further losses and that's why many traders use the feature.

[barbara44]

I have seen some people that said that the stop loss tool is not compulsory that you’re going to make use of it, it’s all about choice, and matters most when you’re not going to be there in front of your computer to watch the market. They said if you’re going to be there to be watching it, then the stop-loss tool is of no use. I don’t know for those people, but all these tools are very important.

Anyone that wants to be a trader should always read about it and know every necessary tools so that they are not going to be making any mistakes at all. If you’re going to be there, you can decide when to take profit and not make use of the tool that will automatically take profit and end the trade, that’s if the market would continue going up.

[RealMalatesta]

I have seen some people that said that the stop loss tool is not compulsory that you’re going to make use of it, it’s all about choice, and matters most when you’re not going to be there in front of your computer to watch the market. They said if you’re going to be there to be watching it, then the stop-loss tool is of no use. I don’t know for those people, but all these tools are very important.

Anyone that wants to be a trader should always read about it and know every necessary tools so that they are not going to be making any mistakes at all. If you’re going to be there, you can decide when to take profit and not make use of the tool that will automatically take profit and end the trade, that’s if the market would continue going up.

Nobody says stop-loss is not a needed tool? Who says that? Everyone knows that stop loss has a very very important part in a trade and you have to have it if you are going to be there for longer than you look at the screen. Sure maybe day trader who scalp may not need it because he is literally looking at the screen constantly to see where he should sell, so he doesn't need a stop loss because he is already there, but all the other people needs it and I have never faced anyone who has ever said stop loss is not needed ever, even people who do not use it say it is important.

The other two ones are true, I have seen people argue over TA or FA and I believe they are both equally important as well and I have seen people who disregard take profit approach as well and I think it is quite important.

[DoublerHunter]

^ In my own, any of the three trading tools can be useful it will depend on the trader's situation while they are in trading. As a matter of fact, the stop-loss and take-profit tools are more convenient and secure than the technical/fundamental analysis. Though take-profit limits the chances of earning more but it secures you for not losing your investment somehow on the other hand with a stop-loss tool it can secure you for not losing what you invest and since these two can secure your assets, therefore, we cannot say that we don't need to. Nevertheless, for technical/fundamental analysis it can be a great help for traders who has full time in trading because they can check the activities from time to time and as far as I know pros often use this type of tool because it gives them an idea when it is or when it is not to trade.

[StephenJH]

Stop loss is useless for day traders because they can handle the profit/loss ratio by staring at the monitor and checking the hourly price candles on charts. For long-term traders, the situation is a bit different because having a stop loss will save the trades from the unplanned losses. Scalping and trading on small time-frames don't have the high-risk factors compared to big movements on daily charts.

I do not agree to what you just said because for me stop loss is important, I'm a intra day traders where I usually scalp and make gains in just minutes or hours. Stop loss for me is part of my system and it is really advisable to use it. I never enter a trade without using a stop loss because it is part of risk management and every newbies who want to become a better trader should master it. I also do not agree to you when you said that small time frames are not risky, for me it is more risky than daily or weekly time frames because in daily and in weekly time frames the signals and the conviction that you can have is real and the data is really legit unlike in slow time frames there are a lot of invalidation and false signals.

For those who avoid losing huge amount of money, try to focus on managing your risks in trading by having and mastering the art of cutting losses. I think a lot of traders do not use it because they think that it is just a waste of time, for me it is not and we should really give care on it.

Let's compare the same trades for both swing and day traders. The 10 pip is a profit for day traders while the long-term trader looks for more than 200 pips in each trade. The R:R ratio is usually equal on day trading strategies because the idea is to take whatever the market flow gives back. With the stop loss, 10 pips are nothing and it will not take a long time to hit the stop loss. If the trades are stopped out frequently how the day trader is supposed to make money?

[justdimin]

There could be other multiple myths about crypto trading because this is all new kind of market which has never been experienced by any trader some 10 years back. I mean we are all adopting existing trading strategies and methods into an all new asset. It leads to assume about we must work on some different part of trading so that all the existing strategies will be compatible/working even with bitcoin trading without providing room for any myths anymore.

I am saying this because, stop-loss is an important tool in trading but for bitcoin trading it is not needed even in my experience given that I am a long term holder and I never needed to worry about falls like what we have seen in 2018.

Taking out profits time to time is recommend in in most other markets. But, for long-term holding based trading (which is usually we are doing in bitcoin markets) you never need to think about booking profits time to time because if you once start booking then you will slowly get out of market which will end up big losses in your profits after long duration.

[bitbunnny]

Stop loss could be helpful but you can't rely only on it.
Trading demands dedication to the market and your full attention if you want to see some results and make some profit. I don't think there is any tool that can replace human reaction and decision making.
To my opinion the main myth about any crypto tool is that it can make trading instead of you.

[Reid]

Whoever says that stop-loss isn't needed must be an active trader and can quickly stop his losses whenever he has pending trades that are about to go in a loss.

Stop-loss has been helpful to me and just wait for some people to come and they'll say the same.

Yeah, I agree with that.
I am an active trader and I stop everything manually if I feel like it.
But, it doesn't mean a tool won't help. It helps to avoid a larger loss and it's an essential factor if you could save some.
Then, not all manual traders will be there. Sometimes, they will be out and a safety pin is needed just in case the price goes south. Hard south.

[nelson4lov]

@OP, You did a great job at demystifying those myths. They're some of the most talked about trading myths especially the one about stop loss.  In my opinion, stop loss should ultimately depend on the trader and how he/she likes to trade. However, if the user is new to trading, it is highly recommended since it'll save them while they're to get their career up and running.

As for TA + FA in crypto, Its a good combo especially in situations that where both of them compliments the other.

[MCobian]

Without using the stop-loss feature when trading, it can jeopardize the capital we have, because the capital we have can run out if the coin
price drops. With the stop-loss feature, you can minimize losses, therefore it is mandatory to use the stop-loss feature when trading.

For technical analysis and fundamental analysis, you can use it to determine the buy / sell price, so if you want to be successful when trading,
at a minimum must be able to master technical analysis and fundamental analysis. Without technical analysis and fundamental analysis we will
find it difficult to predict price movements in the market.

The take profit set up is similar to the use of the stop-loss feature, I agree that the use of the take profit set up can be used to ensure that you
don't lose the opportunity to get profit when the price goes up. Because if you do it manually, sometimes you can failed taking profit, because
the price drops suddenly. Usually pump coins are never long, so it takes a take profit set up so that our coins are sold at the target we want.

[noorman0]

I will speak as a day trader (not leverage, BO or other brokerage services)
Trading periods and strategies are flexible as I have a lot of time in front of the computer and strategy changes can occur at any time depending on price movements. There are times when I can't decide where the price will go next due to complicated charts, snd the Stop Loss configuration is very important to minimize my risk. I usually reduce my risk level gradually by increasing the SL value as the price goes up.

[jostorres]

I do not agree that this stop-loss thing is a myth. Because, I'm not making use of stop-loss for my bitcoin trading still I'm able to make profits. Probably if I make use of stop-loss then the waiting time for my trading might have been reduced significantly but if you're patience enough then you can simply go for skipping stop-loss things.

To make use of stop-loss in your trading you must need to have accurate signals. When you are not good with your technical analysis part then you can simply go for long-term trading which never needs any stop-loss given that you are trading only bitcoins.

Not needing stop-loss configuration cannot be a myth as it is purely depending on your trading strategy.

[bitgolden]

Finding out there is a level system in the stop loss with some of the trading bots I have used was the moment I realized how awesome things could get. I have not only sold but also bought coins thanks to gradual price decreases. What you do is if the price goes down 5% you sell some of it, when it drops 10% you sell a big chunk and when it reaches 20% you end up selling a whole lot of it, only when it reaches around 30% level you start buying back up and as long as it keeps going down you keep buying with the money you made from selling.

What this allows you to have is more coins for the same amount of money and maybe you lose a bit during the way but you could potentially make a lot more recovering from that as well. Which is why I really care that people should put importance on stop loss.

[AakZaki]

Stop loss will save your funds and of course when the market price has decreased very significantly. Stop losses that have been set about the desired lower price limit are certainly very useful. This kind of tool may be ignored by some traders and is not suitable for day traders. every tool provided certainly has a good purpose and is useful if used appropriately.

The Take profit tool is also the same as Stop Loss, because it will help traders to take profit automatically at a predetermined price. This will make trading semi-automatic and more controllable when busy or don't have time to monitor the market.

[gwdf1]

Without using the stop-loss feature when trading, it can jeopardize the capital we have, because the capital we have can run out if the coin
price drops. With the stop-loss feature, you can minimize losses, therefore it is mandatory to use the stop-loss feature when trading.

For technical analysis and fundamental analysis, you can use it to determine the buy / sell price, so if you want to be successful when trading,
at a minimum must be able to master technical analysis and fundamental analysis. Without technical analysis and fundamental analysis we will
find it difficult to predict price movements in the market.

The take profit set up is similar to the use of the stop-loss feature, I agree that the use of the take profit set up can be used to ensure that you
don't lose the opportunity to get profit when the price goes up. Because if you do it manually, sometimes you can failed taking profit, because
the price drops suddenly. Usually pump coins are never long, so it takes a take profit set up so that our coins are sold at the target we want.

Stop-losses must be used. Otherwise, people will look like newbies in gambling, people that think that if they start doing something with enthusiasm, and without caution, they would succeed and make tons of money. This way is the wrong one.

[24Kt]

Stop loss will save your funds and of course when the market price has decreased very significantly. Stop losses that have been set about the desired lower price limit are certainly very useful. This kind of tool may be ignored by some traders and is not suitable for day traders. every tool provided certainly has a good purpose and is useful if used appropriately.

The Take profit tool is also the same as Stop Loss, because it will help traders to take profit automatically at a predetermined price. This will make trading semi-automatic and more controllable when busy or don't have time to monitor the market.

Those tools are actually helpful if used appropriately. For some, it is useless but for some traders, those tools will save their day. It depends on what situation they are currently on, and if they know how they can employ those tools to their advantage, they will reap profits from trading.

[NeilLostBitCoin]

These things are useful, it can help you in your trading. But day trader should not use stop loss since they can monitor their trades without using it, stop loss is highly recommended if you are going to make it in a long term investment wherein you will let your asset in your  exchange wallet, and if sudden change will be made, it will not affect you so much.

[DevilSlayer]

Stop loss is useless for day traders because they can handle the profit/loss ratio by staring at the monitor and checking the hourly price candles on charts. For long-term traders, the situation is a bit different because having a stop loss will save the trades from the unplanned losses. Scalping and trading on small time-frames don't have the high-risk factors compared to big movements on daily charts.

I do not agree to what you just said because for me stop loss is important, I'm a intra day traders where I usually scalp and make gains in just minutes or hours. Stop loss for me is part of my system and it is really advisable to use it. I never enter a trade without using a stop loss because it is part of risk management and every newbies who want to become a better trader should master it. I also do not agree to you when you said that small time frames are not risky, for me it is more risky than daily or weekly time frames because in daily and in weekly time frames the signals and the conviction that you can have is real and the data is really legit unlike in slow time frames there are a lot of invalidation and false signals.

For those who avoid losing huge amount of money, try to focus on managing your risks in trading by having and mastering the art of cutting losses. I think a lot of traders do not use it because they think that it is just a waste of time, for me it is not and we should really give care on it.

Let's compare the same trades for both swing and day traders. The 10 pip is a profit for day traders while the long-term trader looks for more than 200 pips in each trade. The R:R ratio is usually equal on day trading strategies because the idea is to take whatever the market flow gives back. With the stop loss, 10 pips are nothing and it will not take a long time to hit the stop loss. If the trades are stopped out frequently how the day trader is supposed to make money?

I will never take a trade with equal risk and reward ratio. A worth it trade for me is above 2 or 3 risk and reward ratio. Why would I enter a trade if the RR is equal to each other. When it comes to taking profit, I do not agree that 10 pip is the required sell. My taking profit is depends on the market structure and market movement. I usually do swing trading so my cut loss is just below support level and my target profit is usually the resistance area. Cut loss are important to prevent huge losses, a day trader can make money if his/her strategies have high winning rate probability. I will give back the question. What if a day trader do not have stop loss? of course his/her capital will easily burn.

[Hyper88]

Who is Mickael Mosse?

[Wexnident]

A stop-loss configuration and Take-Profit set up is basically dependent on what type of trader they are. They aren't necessary per se, but you can still use them to aid you depending on your circumstances. The Fundamental and Technical analysis fight on the other hand, I agree with. Any type of information is pretty important, especially if you can assume various things from it, even if it was false. Of course, trash information exists, but well that's part of every analysis tbh, to filtering useful and nonuseful ones. , but well that's part of every analysis tbh, to filtering useful and nonuseful ones.

Who is Mickael Mosse?

He seems to be something like a crypto enthusiast/advisor? I looked it up a bit and found his medium (Probably, since it's mostly crypto stuff). Honestly, just google his name and you can look up a bit of info about him.
https://mickaelmosse.medium.com/

[Boov]

Stop loss will save your funds and of course when the market price has decreased very significantly. Stop losses that have been set about the desired lower price limit are certainly very useful. This kind of tool may be ignored by some traders and is not suitable for day traders. every tool provided certainly has a good purpose and is useful if used appropriately.

The Take profit tool is also the same as Stop Loss, because it will help traders to take profit automatically at a predetermined price. This will make trading semi-automatic and more controllable when busy or don't have time to monitor the market.

Those tools are actually helpful if used appropriately. For some, it is useless but for some traders, those tools will save their day. It depends on what situation they are currently on, and if they know how they can employ those tools to their advantage, they will reap profits from trading.

Precisely, this stated tools above are just a reminder to all of us of which tools were we can generate income most is will be used appropriately. These are all essentials in our trading but do we actually used it? Personally speaking i only did technical analysis and fundamental analysis when it comes in my trading strategies. For me from this technical tools that i have been used frequently i can manage my trading lose wisely than before.

[slaman29]

@OP, You did a great job at demystifying those myths. They're some of the most talked about trading myths especially the one about stop loss.  In my opinion, stop loss should ultimately depend on the trader and how he/she likes to trade. However, if the user is new to trading, it is highly recommended since it'll save them while they're to get their career up and running.

As for TA + FA in crypto, Its a good combo especially in situations that where both of them compliments the other.

I think it does need to be said though, that a stop loss is a requirement for every trade. Yes, where the stop is put is determined by your strategy, risk appetite and timeframe, but no trader should ever set a trade without a stop loss. That's just madness, unless you're hodling for years and are putting in cash you know you don't mind losing (but that's not trading).

[beerlover]

Not gonna lie, everyone could call themselves a "crypto currency consultant" or whatever crypto tag you want to have, doesn't mean you are going to be credible or even respected, look at linkedin, there are tons of unemployed people who call themselves "blockchain expert" or "crypto investor" and stuff like that. At the end of the day, I would say the best way to approach these kind of people to check what they wrote and see if they know what they are talking about and how valuable what they bring to the table.

Looking at this one, he knows what he is talking about and not talking about something wrong, that is a good sign, but it is also nothing too shocking or things we don't know so he is not awesome neither, I would give him 7/10 for this topic alone, didn't check his medium.

[CryptocurencyKing]

The stop loss and take profit configuration are tools that surely helps a swing trader to stay in the market without ensuring more losses than he or she the trader can handle. How cool can a tool be if it does this already!
You can imagine not having to watch a trade and it suddenly changes trend direction and goes very far against you, imagine the damage it would cause to your account. These are the little things that makes traders go crazy when not in place. Without stop loss, you'll find yourself focused on your screen and burning lots of data but stop loss guides against uncomfortable losses and take profits checkmates greed when placed properly and calculatively.