BitMEX perpetual contract stop profit and stop loss tutorial

To effectively manage risk in perpetual contract trading, BitMEX provides stop profit and stop loss orders, allowing traders to automatically execute trades at predetermined prices to protect profits or minimize losses.

Nov 09, 2024 at 02:18 am

BitMEX Perpetual Contract Stop Profit and Stop Loss Tutorial

Perpetual contracts are a type of futures contract that does not have an expiry date. This means that traders can hold a position for as long as they want, without having to worry about their contract expiring. Perpetual contracts are also typically traded with leverage, which means that traders can control a larger position size than they would be able to with a traditional futures contract.

Stop profit and stop loss orders are two types of orders that can be used to manage risk when trading perpetual contracts. A stop profit order is an order to sell a contract when it reaches a certain price, while a stop loss order is an order to buy a contract when it reaches a certain price. These orders can be used to protect profits or limit losses, depending on the trader's strategy.

How to Place a Stop Profit Order on BitMEX

To place a stop profit order on BitMEX, follow these steps:

1. Log in to your BitMEX account.
2. Click on the "Trade" tab.
3. Select the perpetual contract that you want to trade.
4. Click on the "Stop" tab.
5. Select the "Stop Profit" order type.
6. Enter the price at which you want to sell the contract.
7. Click on the "Place Order" button.

Your stop profit order will now be placed and will be executed automatically when the market price reaches the specified price.

How to Place a Stop Loss Order on BitMEX

To place a stop loss order on BitMEX, follow these steps:

1. Log in to your BitMEX account.
2. Click on the "Trade" tab.
3. Select the perpetual contract that you want to trade.
4. Click on the "Stop" tab.
5. Select the "Stop Loss" order type.
6. Enter the price at which you want to buy the contract.
7. Click on the "Place Order" button.

Your stop loss order will now be placed and will be executed automatically when the market price reaches the specified price.

Tips for Using Stop Profit and Stop Loss Orders

Here are a few tips for using stop profit and stop loss orders:

• Use stop profit orders to protect profits. A stop profit order can be used to ensure that you lock in a profit if the market price moves in your favor.
• Use stop loss orders to limit losses. A stop loss order can be used to limit your losses if the market price moves against you.
• Place stop orders at strategic prices. The price at which you place a stop order will depend on your trading strategy. However, it is important to place stop orders at prices that are likely to be reached by the market.
• Monitor your stop orders. Stop orders can be adjusted or canceled at any time. It is important to monitor your stop orders and make sure that they are still in place and at the correct prices.

Stop profit and stop loss orders are two essential tools for managing risk when trading perpetual contracts. By using these orders, traders can protect their profits and limit their losses.