Specific Stop Loss or Trailing Stop Loss?

Beginner Questions
1

Hello guys, this is my first topic here :slight_smile:
I was watching Moving Averages Crossover Trading on BabyPips

And I decided to use this strategy:

Timeframe: 4H

SMA1 = 5
SMA2 = 30
[?] SMA3 = 62

When SMA1 crosses SMA2 (and SMA3) from Bottom -> LONG
When SMA1 crosses SMA2 (and SMA3) from Top -> LONG

My doubts are:

#1: Is the 3rd SMA necessary?
(I added it because it can be an EXTRA confirmationā€¦or not?)

#2: How much do I have to set for SL and TP?
I was thinking of setting SL-TP: 50/50 , 50/100 or 100/100

There are so many retracements and ā€˜poorā€™ trends and with a small SL I can hit it several times.

#3: Do I have to use the Trailing Stop Loss to catch up the BIG trends?
If yes, what do you suggest? :smile:

Notes:

  • I want to automate my strategy, so the trade will start on the end of candle.
  • I would prefer to accept few pips (like 50, if it is possible) and make it super-conservative avoiding so many ā€˜fakeā€™ trends and hit SL several times

[Unfortunately, I canā€™t attach images to explain these situations - 'cause Iā€™m a new user]

Thanks in advance!
Hope to find a solution :stuck_out_tongue:

2

Lots of trading approaches use SMA3 as a ā€œfilterā€. So a buy signal is indeed generated as SMA1 crosses above SMA2 but you ignore this if price is below SMA3,: or you ignore the buy signal if SMA3 is sloping downwards. Some strategies use a cross of SMA1 above SMA3 as a ā€œsecondaryā€ buy signal, at which point you might consider adding to your existing long position.

I donā€™t use TPā€™s or Trailing Stops so a trader who deals with these will have to comment on them.

But I always set a SL when I set an order to buy/sell. I have always used TA to find my SL - usually it would be the low/high of a swing high/low (as handy support/resistance). Currently I amusing long entry minus 2 x ATR20 for my stop, it seems just as rational to use a volatility-related SL.

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