Locking Positions

Understanding Locking Positions

• Locking positions refers to a trading strategy that involves safeguarding open trades against losses.
• This method utilizes a counter order, known as a lock, to prevent losses from increasing when the market moves unfavorably.
• Unlike traditional stop-loss orders, locking positions keep the original position active for potential recovery. 🔒

How Does it Work?

• When the price moves against a trader, the locking robot establishes a counter order at a predetermined distance from the main position.
• If the market continues to move unfavorably, this pending lock becomes active and turns into a market order.
• This action freezes the loss at a specific level, allowing the trader to wait for price recovery without incurring additional losses.

Key Features of Locking Positions

• The lock is placed at a distance comparable to where a trader would typically set a stop loss.
• Each position opened by the trader is accompanied by its own distinct lock, which can be adjusted manually if necessary.
• The system provides a Break Even feature that closes the lock profitably once the price returns to the initial position. 💰

Benefits of Using Locking Positions

• Prevents the escalation of losses by literally locking in potential losses at a predefined level.
• Allows for increased flexibility as traders can continue to hold losing positions with a potential to recover.
• Supports multiple positions, meaning traders can secure an unlimited number of trades simultaneously. 🎉

Implementation Considerations

• It's advisable to use main positions without stop losses when employing this technique; instead, use locks as a safety net.
• The trader must set appropriate parameters for locking distances and stop losses according to their trading strategies.
• The robot controls and manages all locking functionalities automatically, ensuring adaptability in volatile market conditions.