How to Set Stop Loss on Coinbase
Cryptocurrencies are often very volatile and we all know it.
That’s why setting a stop loss order might be the best course of action for your portfolio’s well-being.
Let’s set a quick hypothetical scenario: you placed market orders for some coins, but now the price is dropping non-stop and you don’t want to lose money.
In this case, setting up stop losses will cause the platform to automatically place an order at the price you want to sell.
Since you can’t be all day long looking at your charts, this automated way helps you to experience fewer losses on your portfolio.
Continue reading to get more information about:
- How to set Stop Loss on Coinbase;
- Things you need to know about a stop loss order;
- Coinbase Pro stop loss sell orders.
Understanding Stop Loss Orders on Coinbase
Automatically selling your assets if the market is going down seems like a smart decision.
Your order book in Coinbase is presented with many Order Types that help you to have a better experience with Market Buy.
You can buy or sell crypto on the platform, but all smart traders know the importance of a stop order placed on time.
1. You Can Only Set a Stop Loss on Coinbase Pro Account
That’s right - only Coinbase Pro users can place stop loss orders at their will.
Coinbase Pro appears to have all the necessities that day and frequent trailers need on their transactions.
The advanced options granted by Coinbase Pro make understanding some concepts, such as slippage and partial fill, easier than ever.
So, sadly, an open position placed on the standard Coinbase platform won’t experience limit orders if the price drops.
Pro Tip: Coinbase vs. Coinbase Pro: which one is better? It depends on your needs. For instance, if you are not a frequent trader, having a simple Coinbase account might be enough.
Following the same idea, experienced traders will find Coinbase Pro very useful. Learn more about their differences by checking out our related blog post.
2. Stop Price and Limit Price
It is common for newbies to get confused with the concepts of Stop Price and Limit Price:
- Stop Price is defined as the given price in which the order triggers - the conditional order will activate itself when it reaches the current price set by you;
- Limit Price is the desired price at which you will sell. That’s why most people set the limit price slightly below the stop price.
Understanding the differences between these two prices is a must before placing a stop order on Coinbase.
3. Check the Current Market Price Before Placing Orders
Short-term movements in crypto markets are as wild as they get.
Setting up a stop price is certainly one of the best ways of protecting you from several prices changes, but you need to do your search before you decide to buy or sell any crypto.
Setting a limit order highly depends on your trading strategy and the order type you usually perform.
That’s why you never must consider a stop loss order, or a stop price, as something that can be taken lightly.
How to Set Stop Loss on Coinbase
Now that you know what a limit order and a stop loss order is, let’s do it - let’s set a stop loss order!
Remember that, for practical purposes, this can only be done from a Coinbase Pro profile.
So, log into your account, and let’s do it.
Step 1: Place a Market Order
Firstly, it’s imperative to own a cryptocurrency beforehand acquired through market orders.
Open your order book, and go to the trading pair where you want to set the stop lost.
Step 2: Set the Order Type
Now, click on “Sell” and this will open a menu with some options.
The Sell box is where you set the price and information of the asset you want to manage.
Step 3: Go to the “Stop” Tab
Now, in “Sell”, click on the “Stop” tab. Here is where the magic happens - in “Stop,” you will be able to set the parameters for your asset in no time.
Step 4: Set the Stop Limit Order
Do not despair while on this screen: it’s simple. You need to set it up like this:
- Stop price is the price that will trigger the stop loss order;
- Amount is nothing more but the amount of crypto you want to sell in case the order gets triggered;
- In “Limit Price,” just put the lower price in which you are willing to sell the crypto, and, therefore, the operation will get executed.
Step 5: Tap on “Place Sell Order”
Once you have all the boxes filled, just press on “Place Sell Order,” and that’s it - you have just set stop loss on Coinbase!
Remember that a lot of research must be performed before doing this.
That’s why it’s important to get educated on platforms, such as Coinbase Learn, before setting stop loss.
That’s all for now! For more Coinbase info, you can always rely on GrowFollowing.
How Can I Get More Funds on My Coinbase Account?
You can fund your account with fiat money through different methods available on the platform.
If you are facing the Coinbase: Insufficient Funds error, check out our related blog post to learn how to solve this matter.
Karen is a senior technical writer and copywriter here at GrowFollowing. Her area of expertize are social media apps and new media.