For example, let say the eur/usd is 1.2000 and you enter a BUY. Your trailing
stop are 20. It it goes to 1.2020 your trailing stop is now 1.2000? And when do you move it every pip move? This could be time consuming.
Trailing stops are automated.
If the scenario you mentioned above were to occur, and you put your trailing stop on when price hit 1.2020, the stop would be at 1.2000.
Say price move up another 5 pips to 1.2025, your stop would follow it to 1.2005.
If price came down to 1.2015, your stop would stay at 1.2005.
Say price then moved up to 1.2040, the stop would trail to 1.2020. The stop works like a ratchet. It follows up 20 pips behind as price moves, but doesn’t give any back if price comes back at you.
Manually trailing your stop is a different story altogether.
You would move your stop trailing price as you see fit, and have the choice to move it up or down according to what you see happening with your trade. But every move requires you to modify your order.
thanks MT. The reason i asked is i’m in this program (won’t say what it is because people may think i’m spamming) uses the following:
Profit - 600 pips
stop 280
trailing stop - 17
I’m a newbee but what are the chances 600 pips will ever hit if you’re using trailing stop only 17 pips away? 17 pips is nothing in the forex market.
The chance is obviously very low. Unless your system depends on picking tops and bottoms, it would be wise to reduce your t/p.
Hello Master Tang !! trailing stop sounds wonderful but i was wondering asi if the trailing stop order is loaded on the server or it works on client terminal. And if it works on terminal, do we have to keep our terminal always on the go ? with a stable internet connection ?
Exactly, nice exp and there was another thread here regarding the issue of using stops or not…this reply should be reposted there as well…
Actually i posted that question on thread but still i havn’t got the response about either trailing stop is loaded to server or stays o terminal…
Your new stop is registered with the broker, but the move of that stop is done by your client terminal.
So in answer, yes. You must have a computer that is up and awake, with a decent connection for the stop to trail successfully. Sleep, or power saver will result in a failed trail.
Some brokers are now providing VPS services. With a VPS, you could upload a trailing stop to it, and not worry about your computer being shut down.
Trail are over rated.
They should only be used AFTER your target is assumed.
When you bank 1/10th of the move, you’ll look at it like I do.
If you trade tops and bottoms, that tiny 17 pip trail will take up out of the trade 9 times out of 10.
The BEST way to use a trail, A= set after target reached, and B= When you set trap trades, or nets to catch the news burners. Trails are best when they are floated, and run thru like a high speed train. Then,there is no chance of a whip on your trail… It just runs, and cuts at the turn…
*shruggs, just my opinion, as I seen Trails as a bad trait to get accustomed to. Your better off just setting your take profit at 3 pips, to be honest, lol…
lol I am not going to bet any chickens on the 3 pips and as for TS options, I agree…
Nicely narrated … Thank you very much
There is a difference, of course, between fixed and dynamic stops, although both should be treated with caution, if you
do not know how to use them in the right market environment: the one that the OP was talking about is the former (fixed), whereas the latter is one that moves up pip by pip, which may be a better solution to his/her need.
I used dynamic trailing stops for a while, but found them to be ineffective for my own trading (I now move stops manually); however, they could work very well, given the right combination of strategy and trading environment/scenario.
Cheers.