A cut loss strategy is where your crypto asset position is closed to prevent further losses. A cut loss strategy is designed to minimize the potential losses that can occur on a position. If you feel that after crossing a certain price the market will continue to lose money, you can choose to close the position to stop the loss from getting worse, hence the name "cut loss".

Types of Cut Loss Strategies
There are three main cut loss strategies in crypto asset trading. They are each important in their own way to determine the best course of action for a losing position.

1. Full cut loss
   With the full cut loss strategy, the entire position will be closed at a certain level. This is especially useful when the market is very volatile and unpredictable, making it very difficult to analyze rationally. To prevent further losses that are almost guaranteed to occur, this type of cut loss strategy is very effective.
2. Partial cut loss
   With the partial cut loss strategy, only a portion of the position will be closed. This is a common strategy when the market is a bit volatile and you only want to close half the position just to be on the safe side.
   The other half will still have the opportunity to incur losses or gains as it remains open, allowing you to benefit from the market once volatility decreases.
3. Drifting Cut Loss
   With the drifting cut loss strategy, the price at which the position will be closed is predetermined. It continues to fluctuate with the price.
   The drifting distance is the difference between the cut loss level and the current price of the crypto asset. If the price of the crypto asset rises, the price at which the planned cut loss will rise with it, and vice versa.