So according to [https://www.binance.com/en/support/faq/how-to-use-spot-trailing-stop-order-339635f6260d43c5aefa4c3c921728ec](https://www.binance.com/en/support/faq/how-to-use-spot-trailing-stop-order-339635f6260d43c5aefa4c3c921728ec) your sell trailing stop order will not kick off until the price has exceeded the percentage and then send your sell limit order to the books.

I don’t understand why you need to set a limit price. If you miscalculated or whatever and set the price limit ABOVE where the percentage would trigger then the sell order will never sell even though the percentage was hit unless the price goes back up and hits that limit. Why would you ever want to willingly set it above the percentage threshold that you set???

So realistically you will ALWAYS need to set the sell price LOWER than the price would be at the percentage trigger point. If that is the case why not get rid of this field and have it execute the order immediately once the percentage is triggered at that price or if the order is too large then spread it over the next lot of buy orders? Wouldn’t this give the seller the best price before a massive drop?

I don’t understand what is the point of needing to specify a price limit?

For people that do use this would you not set the limit to as close to zero as possible because your sell order will go first because it is the lowest and the actual price that you will get will be the market price which will be much higher.


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2 Comments

  1. Kno010 on 1. July 2023 at 13:53

    You are free to set the limit low if you want, but some people might not be willing to sell below a given limit and would prefer not to sell at all if it goes below.

    I don’t use any kind of stop loss, but I can walk you through the logic of why you might want to not have a stop loss order filled even if the stop loss is triggered.

    Imagine you buy some asset for $80 because you believe it to be worth $100. Then price skyrockets to $150. Instead of selling to take profits some people might want to set a trailing stop loss instead. So if the price falls to for example $125 you want to lock in the profits by having the stop loss trigger.

    But no matter what you never want to sell below $100 (because that is what you think it is worth). So you set a trailing stop loss to help you take some of that profits, but you set the limit at $100 to make sure you never sell below the value you think it is worth.

    You wouldn’t want to have a sale executed at for example $50 during a quick collapse in price because you expect it will always return to $100. So at that point you would rather not sell at all.

    It could even make sense to set the limit above the stop loss. Something like “okay, if this falls back to $100 then that must actually be what it is worth for sure, and in that case I want to sell if it ever returns to $125”.

    Not saying these or other strategies would necessarily make a lot of financial sense. But I could see some people wanting to use them anyways.

     


  2. BinanceCSHelp on 1. July 2023 at 13:53

    Hey there.
    Please, let us check the details, so we could better see the whole situation and provide you with a better explanation.
    Please, kindly open a live chat on this page [https://www.binance.com/en/chat](https://www.binance.com/en/chat) and we will help you to understand it. You can open a chat any time you want.
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