Let Profits Run! Complete Freqtrade Trailing Stop Configuration Guide

This article was produced by the Quantitative Trading Lab at https://www.itrade.icu. Visit for more benefits. Trailing Stop is a widely used risk management tool in trend trading. It automatically adjusts the stop-loss price as profits grow, locking in gains and limiting drawdowns. Freqtrade provides several parameters to finely control the behavior of trailing stops.

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⚙️ trailing_stop — Enable Trailing Stop

trailing_stop = True

When enabled, the system dynamically adjusts the stop-loss based on the highest profit point, allowing profits to run.

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📈 trailing_stop_positive — Take-Profit Pullback Threshold

trailing_stop_positive = 0.02  # 2%

A trailing stop is triggered when the price retraces more than this proportion from the peak profit.

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🎯 trailing_stop_positive_offset — Activation Threshold

trailing_stop_positive_offset = 0.05  # 5%

The trailing stop only activates after the profit reaches this minimum threshold.

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🔄 trailing_only_offset_is_reached — Wait for Pullback to Trigger?

trailing_only_offset_is_reached = True

• True: Stop-loss triggers only after the price retraces beyond trailing_stop_positive

• False: Trailing stop starts as soon as the profit reaches the offset

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📊 Example: Buy Price at 100 USDT

trailing_stop = True
trailing_stop_positive = 0.02
trailing_stop_positive_offset = 0.05
trailing_only_offset_is_reached = True

Time	Current Price	Profit %	Highest Price	Offset Reached (5%)	Pullback Trigger (2%)	Stop Active	Estimated Stop Price
t0	100	0%	100	No	No	No	—
t1	106	+6%	106	Yes	No	No	—
t2	104	+4%	106	Yes	Yes	✅ Yes	103.88
t3	108	+8%	108	Yes	No	✅ Yes	105.84
t4	105.5	+5.5%	108	Yes	Yes	✅ Yes	105.84
t5	103	+3%	108	Yes	✅ Price below stop	✅ Triggered	🔔 Stop Activated

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🚀 Practical Suggestions

Strategy Type	Recommended Parameters
Beginner	positive = 0.02, offset = 0.05, only_offset_is_reached = True — safe and stable
High-volatility	positive = 0.01, offset = 0.03, only_offset_is_reached = False — more responsive
High-frequency scalping	Consider disabling trailing stop and using fixed TP/SL, or use small pullback & offset for quick profit

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✅ Parameter Summary Table

Parameter	Description	Recommended Default
trailing_stop	Enable trailing stop mechanism	True
trailing_stop_positive	Max retracement from peak profit (take-profit pullback)	0.02 (2%)
trailing_stop_positive_offset	Minimum profit to activate trailing stop	0.05 (5%)
trailing_only_offset_is_reached	Wait for retracement to trigger trailing stop	True

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Using trailing stops wisely lets your profits run while stopping risks in their tracks. Proper parameter settings can significantly improve the strategy’s risk-reward ratio.