How can I set reasonable stop-loss levels? My approach is to limit the loss on each trade to within 2% of the principal, so even if I fail several times in a row, I won't be severely hurt.

How exactly do I do this? Let's take a principal of 1000U as an example. If I use 10x leverage to open a position, that means a position size of 200U. The stop-loss point for this trade would be a loss of 20U—that's a 2% reduction of the principal.

How to determine the number of points for the stop-loss? The mainstream approach is based on the volatility of the currency. Bitcoin is usually set around 1000 points, Ethereum around 30 points. This range can accommodate normal market fluctuations without being too loose.

There's a particularly important detail here—don't set the stop-loss too high. Many people are greedy, thinking, "What if the market moves 3000 points in the opposite direction?" So they set the stop-loss at 2000 points. It sounds like insurance, but it's actually suicidal. Calculate the risk-reward ratio: if the stop-loss is 2000 points and the target gain is 3000 points, then when you win, you only earn 1.5 times the stop-loss loss. But if you set the stop-loss at only 1000 points and the same 3000-point gain, your reward is 3 times the risk—that's a completely different return.

This is the core logic of risk management. Don't always think about turning the tide in one shot; control your risk per trade and let time and compound interest do the heavy lifting.