Percentage Trailing Stop with a Breakeven Trigger

Summary

This document explains a long-only stop method linked to entry price. Before price rises by the selected percentage, the stop is placed below entry by that percentage. Once price exceeds the trigger, the stop moves to entry, aiming to prevent the position from turning into a loss before costs. The example pairs this stop with a moving-average crossover: a fast and slow simple moving average crossover opens a long position, and a downward crossover closes it. The stop is submitted while the position is open.

The document gives a default trail setting and a BTC/USDT futures backtest window, but provides no performance results. It warns that a percentage chosen too narrowly or widely can produce unwanted exits, and that sudden gaps may make stop execution differ from the intended level. The code maintains the stop at its prior maximum, but its update is based on closing prices, and the stated breakeven behavior does not guarantee a net breakeven after fees, slippage, or gaps. Dynamic thresholds and additional exit rules are suggestions rather than evaluated improvements.

Key ideas

• The initial long stop is set below entry by the selected percentage until price passes the profit trigger.
• After the trigger is reached, the stop is raised to the entry price and is not lowered afterward.
• A fast and slow simple moving average crossover provides the example’s entry and discretionary exit signals.
• The document gives a BTC/USDT futures test period but reports no measured strategy performance.
• Threshold choice, transaction costs, and price gaps can undermine the intended breakeven protection.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.