Most risk controls work quietly in the background — sizing positions, capping losses, pausing after a bad streak. The kill switch is different. It is the control you reach for when something is wrong now and you need trading to stop instantly, no matter what else the bot believes. It is the override that always wins.
What the kill switch is
The emergency kill switch is an instant stop that halts trading and overrides every other rule. When it fires, no new orders are placed — full stop. It exists for the moments that do not fit a tidy limit: a market gone strange, a strategy behaving in a way you did not expect, or simply a decision that you want everything to stand down while you investigate.
Per-strategy and global
- Per-strategy — stops a single strategy while the rest of the system keeps running under its normal limits. Use it when one strategy is misbehaving but the others are fine.
- Global — stops everything at once. Use it when you want the entire bot to stand down immediately, regardless of which strategy is doing what.
Why it overrides everything
A kill switch that could be second-guessed by another rule would not be a kill switch. By design it sits above the rest of the risk stack: when it is engaged, no signal, no matter how strong its cost-beating math looks, will place an order. That absolute quality is the whole point — in an emergency you want certainty, not negotiation.
It protects capital; it does not promise returns
The kill switch is a capital-protection tool, not a performance tool. It cannot make a strategy profitable; it can only make sure a bad situation stops getting worse. Like every control here, it is about discipline and protection — never a promise of gains, and nothing here is financial advice. Every kill-switch event is recorded in the audit trail so you can review exactly what was stopped and when.
Pair the kill switch with everyday limits in how to set per-trade and daily risk limits. To see where these controls are enforced, read about the Kraken API trading bot, and for why rejecting weak signals is itself risk control, see the signals pillar.