There is a widely circulated saying in the crypto community—"Small stop-loss, high take-profit." It sounds incredibly professional, almost like the golden rule of risk management. In reality, this approach has harmed countless novice traders and is a kind of slow-acting poison that causes unseen damage.

The core issue boils down to one point: the logic itself is flawed. Setting stop-losses too tight results in being stopped out by normal market fluctuations of 1%-2%; setting take-profit targets too high makes achieving them painfully unlikely. The final outcome is small losses happening every day, while the opportunity for big gains is forever out of reach. On the surface, you're engaging in risk hedging to pursue high returns, but in essence, you're trapped in the worst odds—repeatedly making the least probable losing trades.

This problem hits even harder in the crypto environment. Daily fluctuations of 1%-2% are normal; placing stop-losses within this range is like handing your chips directly to market noise to manipulate. Consider the real market logic: large funds never need precise predictions of direction. They simply target the areas where stop-loss orders are most densely clustered. Small stop-losses happen to be in the most fragile liquidity pockets, naturally becoming targets for sweeping.

Now, look at the high take-profit side. Many mistakenly believe that setting a distant take-profit means earning more. In fact, the higher the take-profit level, the lower the probability of reaching it. You're no longer betting on normal market movements but gambling on a miracle. The harsh reality is: stop-losses often get hit with -2%, -3% cuts multiple times a day; meanwhile, take-profit targets of +10%, +20% might not be touched even once in a whole month. Plus, with slightly larger positions, your account won't blow up overnight, but it will be gradually worn down over time.

Traders who truly survive in the crypto space tend to do the opposite. Stop-losses are not set as small as possible but are placed at levels supported by technical logic. Take-profits are not aimed at chasing sky-high gains; the key is to repeatedly and steadily realize profits. Trading is never about one big, game-changing move. It’s about managing overall odds and maintaining disciplined execution.