Stop Hunting: How to Avoid Being Stop Hunted by “Whales”

Stop hunting is a technique implemented by large traders who use the mechanics of the stop-loss order to help propel their position to profit. Additionally, stop hunting forces smaller traders out of a position and gives larger traders momentum behind their trades.

Stop hunting requires the use of stop-loss orders, which are converted to market order when triggered. The eventual market orders can create fast-moving markets, giving the crypto whales a quick win.

There are three strategies a trader can follow when they fear being stop hunted. These strategies require the use of a stop-loss order in conservatively placed spots on the chart. 

What Is Stop Hunting?

Stop hunting is a trading strategy that involves large traders pushing the market to trigger the stop-loss orders of other traders. The stop-loss orders force those traders out of their positions. Once those orders are cleared, the market reverses.