GDC Trade’s Smart Trade is a comprehensive stock exchange trading tool. It enables users to place multiple orders to hedge and minimize risks if the asset price moves in the opposite direction.
Smart Trade can be used to:
Smart Trade is one of the key strategies used on the GDC Trade platform. Here, we take a detailed look at Smart Trade’s functions and explain how registered traders can add take-profit levels and apply a stop-loss.
Smart trade’s mechanism is generally based on the Martingale method and allows traders to create a chain of consecutive actions. Traders work from a correction, taking the following steps:
The terminal works for Spot and Futures trading. When working with a Futures account, the option to select a margin and type of transaction is included.
Let's explore how to reproduce this scheme using GDC Trade…
Choose a section
To enter Smart Trade, click on the 'Trade' section on the main panel of the GDC Trade website. Then select 'Smart Trade' from the drop-down list. Members will then see the familiar chart and trading tools.
Please note: The page interface changes depending on the type of platform a member’s GDC Trade account is linked to. In this example, we use the Binance exchange and quotations of the cryptocurrency pair BTC/USDT.
In the price setting block there are basic and additional options for implementing the Martingale method:
Please note: Regardless of the buy level, the maximum number of TP is always three. The key difference is only that the Take Profits of the lower order levels will be applied to the total amount.
At the bottom of the page, members can view and edit the list of orders along with open and completed trades.
A stop-loss (SL) level is a predefined coin price set below the order entry price, at which the position will be closed to minimize a trader's losses.
Take-profit (TP) levels fix the position at a predetermined, more favorable price. By setting the levels on the GDC Trade platform, the system will start regularly tracking the execution of buy orders within a smart deal. If the price reaches the second buy level (2 price limit), the system will cancel the TP level and leave the TP level 2 with the sale of the entire asset value.
Smart Trade’s main purpose is to protect a member’s deposit during a deep correction using the Martingale method:
For example: If a Level 1 buy order is placed at 18,500 for $100, the second level should have an entry point below the first level and at a higher amount - for instance, an entry at 18,100 (second level) for $150 would move the average purchase price of the asset to 18,258. In this case, the drawdown on the total position will be approximately -0.86% and a smaller price movement will be required to break even or go over.
As soon as the first take-profit of a trade is executed, the strategy and the trade are considered to be ‘worked out’, and all unexecuted orders at lower levels and their take-profits are automatically deleted from the exchange.
The terminal on GDC trade has the main advantage of enabling traders to set the exit levels of the position by considering the average price of the deal and the full volume of the position involved in the deal.
For example, the correction is expected to be 30% and the position's set levels cover this movement. If the price correction continues, and the trader is not ready to risk a larger amount, they can set one of the stop-loss options. Traders can therefore limit the maximum possible loss on the position. As soon as the price reaches the stop-loss level, the system will close the entire position at the market price at a predetermined loss.
Break-even (BE) stop-loss
Break-even (BE) stop-loss means placing a stop-loss at the average entry price level into the position when part of the position is closed at take-profit. Closing the remainder of the position is done with a market contract if the price returns to the average price. All unexecuted lower transaction-level orders are canceled and the transaction status changes to 'closed.'
Example: When the price reaches the designated entry levels into the transaction, the corrective movement may stop and the moment of price reversal will occur. It’s impossible to predict how strong the reversal movement will be, therefore setting several take-profits in the ratio is recommended, for example: 40% / 40% / 20%.
Conditions for checking the activity levels:
Break-even stop-loss implies that as soon as the price reaches the first level of take-profit the system will then, with a sharp reversal to the average entry price, automatically close the position at the entry price.
Applying stop-loss and take-profit parameters, GDC members can make the trading process as safe as possible. And by dealing with stop-loss CU, members can guarantee profits from the market.
Members can develop a strategy for working with a cryptocurrency pair a few steps ahead, then set the terminal to rest easy. GDC Trade will track the price, execute orders and ensure members are always in the black.
Secure your actions on the SPOT market and limit possible losses when trading crypto assets using GDC Trade’s intuitive platform. Happy trading!