Bithumb perpetual contract stop profit and stop loss tutorial

Bithumb Perpetual Contract Stop Profit and Stop Loss Tutorial

Perpetual contracts, also known as perpetual futures, are a type of derivative financial instrument that allows traders to speculate on the future price of an underlying asset without having to take ownership of the asset itself. Stop-loss and take-profit orders are two essential risk management tools that can help traders protect their capital and lock in profits.

Placing a Stop-Loss Order

A stop-loss order is an order that is placed to automatically sell an asset when the price falls to a predetermined level. This can help to limit losses in the event of an unexpected market downturn. To place a stop-loss order on Bithumb:

1. Log in to your Bithumb account and navigate to the "Perpetual" tab.
2. Select the perpetual contract you want to trade.
3. Click on the "Order" button and select "Stop-Loss Sell".
4. Enter the stop-loss price, quantity, and other order parameters.
5. Click on the "Place Order" button.

Placing a Take-Profit Order

A take-profit order is an order that is placed to automatically sell an asset when the price rises to a predetermined level. This can help to lock in profits and prevent them from being eroded by market fluctuations. To place a take-profit order on Bithumb:

1. Log in to your Bithumb account and navigate to the "Perpetual" tab.
2. Select the perpetual contract you want to trade.
3. Click on the "Order" button and select "Take-Profit Sell".
4. Enter the take-profit price, quantity, and other order parameters.
5. Click on the "Place Order" button.

Managing Stop-Loss and Take-Profit Orders

Once you have placed a stop-loss or take-profit order, you can manage it by:

1. Modifying the order price, quantity, or other parameters.
2. Canceling the order.

To modify an order, simply click on the "Edit" button next to the order in the order list. To cancel an order, click on the "Cancel" button.

Best Practices for Using Stop-Loss and Take-Profit Orders

1. Use stop-loss orders to protect your capital from unexpected losses.
2. Use take-profit orders to lock in profits and prevent them from being eroded by market fluctuations.
3. Place stop-loss orders below the current market price and take-profit orders above the current market price.
4. Use realistic stop-loss and take-profit levels.
5. Monitor your stop-loss and take-profit orders regularly and adjust them as needed.

By following these best practices, you can use stop-loss and take-profit orders to effectively manage your risk and protect your capital.