Algorithmic Trading Without Fear: Risk Management Tools in Moontrader, Part 1

Cryptocurrency trading is a whirlwind of opportunities - and risks. That's why proper risk management is essential, especially when using algorithmic strategies. In this article, we'll walk you through some of the key features available in Moontrader to help you protect your assets, minimise losses and automate defensive trading actions.

Watchdog: protection against connection loss

Watchdog is an emergency safety mechanism that ensures your trading positions are protected if something goes wrong.

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Technically speaking, Watchdog is a backup core that monitors the stability of your main trading cores. It creates a communication bridge between your Moontrader cores and the exchange. If the connection to the core is lost. due to a crash, shutdown or other failure. Watchdog will immediately send commands to the exchange to close all open positions and cancel all outstanding orders.

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Please note: if you're holding long-term positions, keep in mind that Watchdog will close all open trades when triggered.

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Want to install this powerful risk management tool in Moontrader? Follow our step-by-step guide to configure Watchdog on your local setup or VPS.

Triggers & Actions: automated reaction to cryptomarket events

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The Triggers & Actions system is a powerful way to automate your responses to key trading events, with customisable logic tailored to your strategies. This system follows an 'event-response' model - Triggers detect events and Actions execute the appropriate response.

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Here's how it works:

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1. Set triggers for specific trading events, such as order filled, take profit reached, stop loss hit, trade closed or signals received from the Market Watcher.
2. Assign actions to be taken when the trigger is activated: run or stop an algorithm, pause a strategy, switch strategies or even execute a panic sell.

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How to install? We've created a detailed setup guide to help you fully automate your strategies and protect your money in volatile market conditions. Use the Triggers & Actions, so you can reduce risk, adapt to market changes in real time and avoid constant manual monitoring.

License level loss limits: the line of defence 

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Moontrader allows you to set loss limits per licence in your personal account dashboard. When these limits are reached, trading will automatically stop - making this feature an important safety net, especially if you can't be at your screen 24/7.

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You can set two types of limits:

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• Percent limit (soft limit): this is triggered when your account balance falls to a certain percentage of your deposit, calculated at the time of core start or restart. For example, if set to 80% and your initial balance is 100 USDT, trading will stop at 80 USDT. After an auto-stop, you'll need to restart the core to resume trading, and the 80% threshold will now be based on the new balance of 80 USDT.
• Fixed Limit (hard limit): trading stops when your balance reaches a certain amount. For instance, with a deposit of 100 USDT and a hard limit of 50 USDT, trading will stop at 50 USDT. To resume trading you will need to manually update the limit and restart the core.

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Important notes:

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Limits only work while the core is running. If it crashes or stops unexpectedly, the stop command won't be sent.

Percent limits are only recalculated after a core restart and are based on the balance at that moment.

Fixed limits remain static until manually updated. For example, if your deposit grows from 100 USDT to 1000 USDT, the limit will still be triggered at the original 50 USDT. So don't forget to review your limits.

Pay particular attention to these settings if you are trading manually or holding long positions - an auto-stop will forcibly close all of them.

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Trade smarter, not riskier 

Risk is an inevitable part of crypto trading. But with the right tools and mindset, you can control it. With numerous built-in risk management tools, Moontrader gives crypto traders the ability to protect their deposits and keep trading stable and profitable, even in highly volatile conditions.

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