The Market Crash Safeguard is a setting in Options Auto Trader that helps protect your account from significant losses during market downturns. This article explains how it works, how to enable it, and whether it’s the right choice for you.
Why it exists: Option selling strategies carry high risk if the market crashes.
What it does: Exits positions early when the market shows signs of a potential crash.
Goal: Reduce exposure to large losses by temporarily stepping out of the market.
The safeguard monitors market conditions using the Bollinger Bands indicator.
If the market price moves above the upper Bollinger Band and then drops back below it, this signals a potential crash.
Once triggered, the safeguard does the following:
Closes all open positions to lock in profits and reduce risk.
Stops trading for 30 days, allowing the market to stabilize.
After 30 days, trading resumes automatically unless you manually override the safeguard.
To enable this feature:
Go to your bot settings in Options Auto Trader.
Find the option labeled “Exit early if the market is likely to crash” (Market Crash Safeguard).
Enable the setting if you want the safeguard to be active.
Save your settings and monitor your trades.
You should consider enabling it if:
You prefer a low-risk, stable trading strategy.
You want to avoid large losses from unexpected market crashes.
You’re looking for consistent income and long-term capital protection.
You might NOT want to enable it if:
You’re comfortable with higher risk and short-term fluctuations.
You prefer to manually manage risk instead of using an automated safeguard.
You want continuous trading without interruptions, even during market downturns.
You can enable or disable the safeguard at any time in your bot settings.
If the safeguard exits your positions and you don’t want to wait 30 days, you can manually turn it off and resume trading.
Before using it in a live account, it’s recommended to test it in paper trading mode to see how it performs.
The Market Crash Safeguard is a powerful tool to reduce crash-related losses and provide a more stable trading experience. While it won’t catch every market drop, it can help minimize risk for traders seeking consistent returns.
If you’re unsure whether to use it, test it in a demo account first and adjust settings based on your risk tolerance.
TERMS OF SERVICE: Please be aware that continued use of the Options Auto Trader is subject to our Terms Of Service. If you have any questions or wish to review these terms, feel free to visit the website.
