What's the biggest fear in futures trading? Holding on when you're winning instead of taking profits, and refusing to cut losses when you're losing. Take-profit and stop-loss are the tools that solve both problems. More importantly, they can be set simultaneously, giving you peace of mind even when you're away from the screen. Today, let's walk through how to set up take-profit and stop-loss on Binance futures from start to finish.
If you don't have a Binance account yet, registering through the Binance sign-up page gets you fee discounts. For futures trading, using the mobile app is recommended — head to the app installer to download and install it. Setting TP/SL on mobile is very convenient.
What Are Take-Profit and Stop-Loss?
Take-Profit (TP): When the price reaches your preset target, the position is automatically closed to lock in profits. It prevents "losing the profits you already had."
Stop-Loss (SL): When the price reaches your preset maximum loss level, the position is automatically closed to cap your losses. It prevents "small losses turning into big losses, and big losses turning into liquidation."
Setting both simultaneously means: whether the price rises to your target or falls to your bottom line, the system will handle it automatically. You don't need to monitor the market 24/7.
Method 1: Set TP/SL When Opening a Position
This is the most recommended approach — set your take-profit and stop-loss at the same time you place your order.
On the Binance futures trading interface, when you're ready to open a position:
Step 1: Choose your trading pair, leverage, and margin mode.
Step 2: On the order panel, select the order type (market or limit) and enter the quantity.
Step 3: Above or below the order button, you'll see a "TP/SL" (Take-Profit/Stop-Loss) option. Click to expand it.
Step 4: Enter your take-profit price. For a long position, the take-profit price should be above the current price (where you expect it to rise). For a short position, it should be below the current price.
Step 5: Enter your stop-loss price. For a long position, the stop-loss price should be below the current price (the maximum drawback you can tolerate). For a short position, it should be above the current price.
Step 6: Confirm the order. Your opening order and TP/SL orders will be submitted simultaneously.
The advantage of this approach is that your position is protected from the very first second. You won't face the awkward situation of "opened a position but got hit before setting the stop-loss."
Method 2: Add TP/SL After Opening a Position
If you didn't set TP/SL when opening your position, or you want to modify existing settings, you can do so from the positions list.
Step 1: At the bottom of the futures trading interface, switch to the "Positions" tab.
Step 2: Find the position you want to configure and click the "TP/SL" button on the right side (some versions display a TP/SL icon).
Step 3: A settings panel will pop up. Enter your take-profit and stop-loss prices separately.
Step 4: Select the trigger type. There are usually two options: "Mark Price" and "Last Price." Mark Price is recommended because it's less susceptible to brief abnormal price spikes.
Step 5: Confirm the settings.
Once configured, the TP/SL orders will remain in place. When one is triggered and filled, the other is automatically canceled — this is known as OCO (One Cancels the Other) logic.
Method 3: Manually Set TP/SL Using Conditional Orders
Besides setting TP/SL directly on positions, you can also use conditional orders (stop-limit or stop-market) for more flexible take-profit and stop-loss configurations.
On the order panel, select "Stop Limit" or "Stop Market" as the order type.
A stop-limit order requires two prices:
- Trigger price: When the market reaches this price, your limit order is activated
- Order price: Your limit order is placed at this price
A stop-market order only requires a trigger price, and once triggered, it executes at market price. Market orders execute faster but may have slippage, while limit orders have no slippage but might not fill if the price moves too quickly.
For stop-losses, stop-market orders are recommended. Since the purpose of a stop-loss is to "ensure you exit," a limit order might fail to fill in extreme market conditions, defeating the purpose of the stop-loss.
For take-profits, either limit or market orders work. If you're not in a rush and want a precise exit price, limit orders are better.
How to Determine TP/SL Prices
This is a question that troubles many traders. Set them too close and normal fluctuations will trigger them; set them too far and they provide no real protection.
Several reference methods for setting stop-losses:
Method 1: Based on technical analysis. Place your stop-loss below key support levels (for longs) or above resistance levels (for shorts). Once these levels are broken, it usually means your directional judgment was wrong.
Method 2: Based on percentage. Set a fixed percentage stop-loss, such as exiting when the position loses 3% or 5%.
Method 3: Based on ATR (Average True Range). ATR measures a coin's normal volatility range. Setting your stop-loss at 1.5x to 2x ATR distance can help avoid getting stopped out by normal fluctuations.
Several reference methods for setting take-profits:
Method 1: Based on risk-reward ratio. If your stop-loss distance is 3%, set your take-profit at least 6% (2:1 risk-reward ratio), ideally 9% (3:1).
Method 2: Based on key resistance levels (for longs) or support levels (for shorts). Price often bounces at these levels, making them reasonable take-profit points.
Method 3: Partial take-profit. Divide your take-profit into two or three tiers. For example, close one-third at 3%, another third at 6%, and let the remainder ride.
Advanced Technique: Trailing Stop
Beyond fixed TP/SL, Binance futures also supports a Trailing Stop function.
The trailing stop logic: the stop-loss price automatically moves up (for longs) or down (for shorts) as the price moves in your favor, but it doesn't move when the price pulls back.
For example: you open a Bitcoin long and set a trailing stop with a 2% callback rate.
Bitcoin rises from 60,000 to 61,000, and your stop-loss automatically moves up to 61,000 x (1 - 0.02) = 59,780.
If Bitcoin continues rising to 62,000, the stop moves up to 60,760.
If Bitcoin drops from 62,000 to 60,760, the stop is triggered, and you close around 60,760.
The advantage of trailing stops is that they lock in most profits while giving the trend room to develop. They're especially suited for trending markets — you don't know when the trend will end, so let the trailing stop decide your exit timing.
When setting a trailing stop, the callback rate is crucial. Too small and normal volatility will trigger it; too large and you'll give back too much profit. Generally, you can refer to the coin's daily volatility range to set it.
Common Mistakes and Considerations
Mistake 1: Opening a position without setting a stop-loss.
"I'll deal with it when the price gets there" — this mindset is dangerous. If a sudden event causes dramatic price movement, by the time you react, you may have already been liquidated. Setting a stop-loss when opening a position should become a reflex.
Mistake 2: Setting the stop-loss too tight.
Placing your stop-loss only 0.2% or 0.3% from your entry price will almost certainly get triggered. Normal market fluctuations can easily hit this level. Give price reasonable breathing room.
Mistake 3: Repeatedly moving your stop-loss.
After opening a position, if price moves against you, you move your stop farther away, wanting to "give it another chance." Then it continues against you and you move it again... Eventually, your loss far exceeds the original plan. Once you set your stop-loss, don't move it in the unfavorable direction.
Mistake 4: Setting take-profit too greedily.
Expecting Bitcoin to gain 20% in a day and setting take-profit at a distant level. The price rises 5% and then falls back, and you capture none of the profit. A reasonable take-profit is more valuable than an unrealistic high target.
Mistake 5: Ignoring slippage.
In extreme market conditions, the price may gap through your stop-loss and fill at a worse level. So your actual loss may be somewhat larger than planned. Factor this in when determining your position size.
A Complete Practical Example
You're about to open a long ETHUSDT position:
- Current ETH price: 3,000 USDT
- You're bullish on ETH reaching 3,150 USDT short-term (5% rise)
- Maximum acceptable loss: ETH drops to 2,940 USDT (2% decline)
- Risk-reward ratio: 2.5:1
- Leverage: 5x
- Margin: 200 USDT
Steps:
- On the ETHUSDT futures interface, set leverage to 5x, isolated margin mode
- Select market order, enter 200 USDT margin
- Expand the TP/SL settings, enter 3,150 for take-profit and 2,940 for stop-loss
- Click "Open Long"
- After execution, check the positions list to confirm TP/SL orders are in place
After that, you can go about your day with peace of mind. Whether the price rises to 3,150 or drops to 2,940, the system will handle it automatically.
Take-profit and stop-loss don't limit your earning potential — they safeguard your trading career from ending due to one or two mistakes. Setting TP/SL carefully on every trade is the best protection a futures trader can give themselves.