Bybit provides another exit option, known as Trailing Stop, which is a more flexible variation of a normal exit order. A trailing stop will allow a stop order to follow the last traded price based on a pre-set distance and direction, and will automatically move to lock in the profit or stop loss.
On Bybit, to set or adjust a trailing stop, navigate to the 'Positions' tab and set the desired trailing distance.
A trader opens a long position of BTCUSD contracts at 8,000 USD, and set a trailing distance of 500 USD.
- If the last traded price never exceeded 8,000 USD, the trailing stop will be triggered at 7,500 USD just like a normal stop loss.
- If last traded price moves to 9,000 USD, the trailing stop price will automatically be adjusted upward by 1,000 USD (stop price can be adjusted by every 0.5USD), and the trailing stop will be triggered at 8,500 USD.
- Stop loss will be triggered only if there is any retracement of 500 USD from the highest price reached. (As seen from the diagram example below)
Setting up an activation price to activate the placement of the trailing stop
When setting up a trailing stop order, a trader has the option to set up an activation price to activate the placement of the trailing stop. This function allows a trader to activate the trailing stop only when the position is in profit, so-called "Trailing Profit"
Current Last traded price (LTP) is 7000 and trader is holding a long position. He wish to place a trailing stop of distance 100 only when LTP has reach 8000.
- The trader simply have to enter 8000 in the activation price and 100 in the trailing stop.
- When LTP reaches 8000 the trailing stop order will be place and the starting trigger price of the trailing stop order will be 8000- 100 = 7900 USD
**Please be noted that if there is no activation price set, the trailing stop will be in effect immediately according to the current last traded price.