Stop loss

Stop Loss is a risk management tool that limits losses. If the price goes against your position, the bot will automatically close the trade with a market order at a pre-calculated level.

Using a Stop Loss helps protect the deposit and avoid liquidation, especially when trading with leverage.

Stop loss by percentage

A simple Stop Loss is a market order that is placed at a set percentage when all grid orders are executed.

For example:

• Grid overlap: 15%
• Stop loss: 5%

So the Stop Loss will be triggered at 20% from the opening price of the deal.

Important

• If the margin is insufficient, liquidation may occur earlier than the grid is executed and the Stop Loss is triggered.
• Do not confuse the percentage of drawdown (MDD or MAE) with the Stop Loss level, these are different attributes.

Since the stop loss is a market order, it is not visible on the exchange until the grid is fully executed. But its location can be seen:

• in the bot’s editor on the Trading View chart,
• in the Active deal card.

Where is the Stop Loss available

• Futures (Bybit, Binance, BingX, Bitget, OKX) → a trigger order placed by the bot on the exchange after executing the last order of the grid.
• Spot → Stop Loss works logically, on the Veles side (the bot tracks the price itself and closes the deal by the market order).
• Other exchanges → the bot sets a closing market order by the results of a regular price check.

Advice

If all the grid orders of the deal are executed, but the Stop Loss is not set up in the bot, you can set a Stop on the exchange manually (section TP/SL). When it is triggered, the bot will stop with an error, but it will be enough to restart it.

Stop Loss by indicator signal

A Stop Loss by signal closes a trade at a loss if two conditions are met:

1. The selected indicator (for example, Bollinger Bands) has been triggered. The logic of the signal triggering is the same as when entering a trade.
2. The price exceeded the minimum indent:
   • from the last order in the grid,
   • or from the average position price.

If the minimum indent is disabled, only the signal is taken into account, but:

• “From last order” option will set a Stop Loss only after the entire averaging grid has been executed.
• “From average price” let the bot not to wait for the execution of the entire grid, the Stop Loss order may be created earlier.

Note

A simple Stop Loss and a Stop Loss on a signal work independently. Whichever of the conditions is fulfilled earlier will trigger the Stop Loss.

How to set up a Stop Loss by a signal

1. Turn on the “Stop Loss by signal” function.

   

2. Set the parameters: Minimum indent (%), the Type of indent (from the average price or from the last order), select the indicators.

   

3. Specify whether the bot should stop after executing the Stop Loss.

Examples

Example 1: from the last order

• Grid: 3 orders
• Filter: Bollinger Bands (30 min)
• Indent: 5%

A Stop was triggered when all orders were executed, the price broke through the lower border of the channel, and the indent exceeded 5%.

Example 2: from the average price

• Grid: 3 orders
• Filter: Bollinger Bands (30 min)
• Indent: 5%

The Stop Loss was activated when the price broke through the lower border of the channel and the drawdown from the average price exceeded 5%.

Stop Loss limits

• Slippage. Any Stop Loss is a market order, and the final loss may be more than the estimated one.
• Backtests. When modeling, the Stop Losses may not always be perfectly taken into account, especially if they fall on the wicks of candles.
• Spot. Averaging is the more often used here, rather than Stop Loss.

Summary

Stop Loss in Veles bots is an insurance against large losses.

You can use:

• Simple Stop Loss by percentage,
• Stop Loss by signal of the indicator.

The best result is a combination of a Stop Loss with correct grid and Martingale settings, plus mandatory backtesting of strategies.