Take profit and stop loss exits
A crypto trading bot can only work with proper exits signals.
Let's see how we can automate them with Kaktana.
Basic stop loss
The goal of a stop-loss is to stop losing money (yay!)
We're going to decide that we don't want to lose more than X % of our trade.
Too many traders forget to use them, and lose a significant part of their capital whenever the prices dips a bit (which happens every week with cryptocurrencies)
To begin with, click on "SELL WHEN" on the top bar: we want to set our sell conditions.
Firstly, we need to create a new OR condition.
Why? Because we don't want to wait for our other conditions to trigger.
For that, click on "ADD .." at the right of the OR text.
To place a stop loss, click on "Add Condition" and then, click on "Stop Loss / Take profit".
After setting your target percentage, you should have this:
Basic take profit
The goal of a take profit condition is to secure your profits.
We want to sell whenever we reach a certain target. In this case, we're going to set it up to 2%.
To create it, follow the same steps than the stop-loss.
How it should look like in the end
These conditions will trigger a sell order whenever our price drops more than 2% or gains more than 2%.
From now on, we can complexify our sell orders to make more precise and clever sell orders, like what we're doing in our RSI strategy or on our turtle strategy.