I want to ask to every traders here in this forum on how we can use stop loss strategy more effectively to make our trade more beneficial. I know stop loss prevents us from huge loss by automatically closing our trade before our whole account balance goes to nill.
So i want to know if is there any other ways of using stop loss so that we can maximum benefits as possible as we can.:56:
I use SL in combination with hedging. I use hedging to block my loss and keep SL on hedge order. Works very nicely for me.
Just using SL didn’t work for me, tried it and failed :eek:
um…it all depends on your trading style…if your trading ranges only then place stop loss above or below the obvious high/low
if your trend trading, initially you might have a huge stop loss, once trade goes in your favor, you can place stoop loss in your favor
if your trading breakouts, you can use tight stop loss
but really your stop loss depends on key resistance/support and on your trading system or style
if you have a “trading system” then it will tell you where to place your stop loss
i think the placing stop loss above/below the nearest low/high works good enough
btw im a fan of “protecting profits”, say i gained 100 pips i might move stop loss to 50 pips and allow me only 50 pips profit of risk i might even move my stop tigher if it gets close to upcoming resistance/support
Hi!
Not only stop loss but money management is key to successful trading. I never risk more than 1% of my capital in any given trade. After a streak of losers I reduce my amount to 0.5%
S/L setting depends on your trading style. There is always one point/price/area where your assumption for a trade becomes invalid. This should be your stop loss.
Kind regards
Thomas
There are two ways in which stop loss orders are placed by traders: arbitrary and logical.
The first type of stop loss is 100% arbitrary, purely based on the trader’s convenience. It’s very common with breakout traders. They just use a fixed stop loss size in pips. Here’s an example of what I mean:
This type of stop loss will get triggered more often than a logical stop loss. A logical stop loss is based on market structure. Basically, you place your stop loss beyond OBSTACLES that you identify ahead of order entry. Here’s an example:
You have to understand how markets work, before you can place a proper stop loss… Hope that helped.
PS: I’m not sure why the images can’t be clicked to enlarge them? Can someone help me with that?
