Please continue!
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So Iām clear, I am no forex expert. Iām just a small fish in a rather large tank, but it also seems that when you enter a trade, you put a stop loss, so essentially you are sayingā¦Iām prepared to lose this one, and the next oneā¦and the next one and so on and so forth. I understand the importance Iām one, earthquake or something bam market could spikeā¦but why not set like a 10% and just let thouse trades ride? I hear a lot of the times when a trade starts going wrong, people panic, jump to the computer screen and instantly start thinking of plan b and working making irrational decision, I find it best when a trade goes bad, to do nothing. Assuming you took a proper position size, even 100 pip swing should not hinder your account any more than a night out on the town. If a proper position size is in place, I really donāt see the need in a stop loss, maybe itāll end me one day! Who knowsā¦but yeahā¦just figured since everyone was going back and forth I had to jump in and feel apart of the topic I started.
Hey @asmstudio7, this brings up another alternative form of risk management or Stopā¦
Equity Protection Software or EA. It has parameters where you can set the pair you wish to apply it too and the amount of drawdown you are prepared to risk on your accountā¦ I have nothing to push or sell as I am regularly accused of. These utilities are available for FREE for both Ctrader and MT4/5ā¦
It can be set (via parameters) to either close positions outright once your DD percentage has been breached or reduce the size of your position to bring the percentage back under say 0.5%ā¦
ie: Set the EA for say 0.5% of your total account and the cross (pair) you are trading and let it runā¦
No stop loss needs to be added to your chart and if or when 0.5% DD (say $5 of a $1000 Account) is reached the position will close.
This is just another way to protect your funds and it allows for your account and risk to grow exponentially.
Example: You trade all week and add $100 to your $1000 (you now have $1100) your 0.5% risk is now equal to $5.50ā¦ you trade all week and lose say $200 (you now have $800) your 0.5% risk is now equal to $4.00 Simple to apply and no rocket science calculations required to work out your stopā¦ the code does it all for youā¦ Like ALL automation it needs to be tweaked to TFās, volatility and your risk appetiteā¦
Leave long winded and complicated at the doorā¦KISS (Keep It Simple Stupidā¦)
LOL
āThe biggest issues for Newbie FX Traders, BY A COUNTRY MILEā¦ is getting constantly stopped out while tradingā
There you go again suggesting your opinions are more than what they are. Now if you said in my āopinion one of the biggest issues (& left out the country mile ā) I donāt think anyone would take issue with you. But you have absolutely no statistical evidence of any kind to support what youāve said.
There are many reasons why new traders fail; mostly and almost always, itās a combination of several things including being stopped out. But as well among the country miles, would be: no understanding of the foreign exchange, over leverage, over trading, over dependence on trading aids.
"So knowing that doing the same thing over and over and expecting a different result is the definition of insanityā¦"
You are right. The key to success is to try and make the same mistake the least amount of times as possible, which is what most people in the thread suggested.
Whatās insanity is jumping from strategy to strategy, alternative to alternative before you know why what you did in the first place didnāt work.
"I am trying to get newbies to seek alternatives to the current misguided* FX educationā¦ "
Once again the thought is Nobel. But most people need to be able to do simple addition, subtraction, multiplication and division before they attempt: Abstract Algebra Ā· Actuarial Math Ā· Advanced Geometry
āAfter a quick look around I now realise you are from the ALWAYS USE A STOP LOSS religious sect.ā
I am from the broader church that says always, always, protect and always always protect your trading bankroll. One of the ways is an analysis of why what you did didnāt work. Not it didnāt work so let me move on to another strategy that I donāt know will work either.
"Iām from the broader church of SURE USE A STOPā¦BUT LOOK AT OTHER ALTERNATIVES"
Thatās fine and thatās your right. I stand and agree with you to decide what you should do for you.
I disagree with you on what you posted in this thread related to the original posterās question on this particular section of the Baby Pips (Beginners) If you posted this in: Trading Discussion, Trading Systems, or Community fine and again most would agree.
But the way to change someoneās thinking is not based on jumping to something else before they figure out why what they did in the first place didnāt work; If after a analysis there needs to be a change. Do it based on Facts, Options and the least of evils concerning you;thatās all Iām saying
Again youāre a smart guy, so Iām sure you didnāt intend to mislead anyone especially those newbies thinking youāre to change
Your definition /mis.guided/
adjective
1.ensuring that new traders lose money to the markets.
Mostly everyone elses
misĀ·guidĀ·ed
/ĖmisĖɔīdÉd/
adjective
ā¢ Having or showing faulty judgment or reasoning: āmisguided attempts to promote political correctnessā
Best of luck to you
Gp
Cheers for the reply TWB - you know how this works, nothing wrong with a little āpush and shoveā 
Hello, @asmstudio7
Your question is a very smart one and very controversial.
In my early days of trading, I always use stop loss (electronically) because the common knowledge says, it is a way to manage and control risk. However, there came a time where I noticed that almost always I can predict the direction of the pair accurately itās just that I was āstopped outā. Slowly, it eats up the capital. Experience gave me a hint on what is going on.
The nature of forex is decentralized pricing. Any broker can āstop you outā because they can quote the price they want and it is in their best interest to do so. Though some traders felt being cheated, I donāt. Itās their business and their value proposition is giving us leverage so we can potentially make money. I think itās fantastic. Our duty as players is to know better.
My solution is another controversial one. Set a āmanualā stop loss or set an āalertā. That means, set the price in your mind (or create the alert) then manually exit the position if the pair draws down to that level. That means you have to āmonitor your tradeā from the time of entry until you exit. The main key here is to properly size your trade positions such that you are not risking too much. For ātake profitā levels (unlike stop loss) you can set it electronically.
It sounds scary for some and yes it is dangerous and risky. But being risky and dangerous is relative and varies depending on traderās skill. Stop loss strategy is just one layer among the stack of protection layers you have to set for your account before it blows up.
I hope you find this helpful, but please be careful, do a lot of demos first. Should you decide to make it live, just start with ātinyā capital only.
Itās good to jump in, not only for you, but for all new and experienced traders to share opinions. Thatās how we all grow. As you can see topics like stop losses are not the same as āAm i ready to tradeā " How m many indicators should i use" āWhatsā the best pair to tradeā etc. There are a lot of opinions on topics like this. Everyone will agree no matter what or how you call it, or do it you need to protect your trading capital. There are many different ways and degrees. You can find them in this and a lot of other threads on Baby Pips. But in the end protect your bankroll.
Now lets get to you and your post. Like you said youāre new, give yourself time and one day it will become very clear to you why you need to have some kind of protection for your bankroll. I swing trade every trading day, From Sunday Open To Friday Close. I donāt open trades every day but I do watch the pairs swing that I trade every day.
If you pick a pair and calculate the average between the high and low or whatever metric you want to use, you will get an average swing For example Eur USD average daily swing is somewhere in the neighborhood of 60 pips. What does that mean.? Nothing. Itās not a contract, itās not blood oath, itās a bunch numbers added together and divided by the numbers. Previous swings do not take into account current events, news, institutions, policies etc. So what you get is a pair that normally swings 60 pips all of a sudden because of whatever drops or jumps 300 hundred pips. So whether use a 10% or 20% or 5% indicators, counter trades whatever use something to protect your bankroll. How you start with a strategy is not how you have to or more than likely will end up with. Pick a 1/2 position on a swing trade, limit your loss to 10% and go from there for example
But hey donāt take my word for it or any other trader, Check it out for yourself., But to yourself a favor and donāt use your trading bankroll to see.
No one??? 
Iām invisible 
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I never use a stop loss I have a mental stop. I use to use stop loss but I always got stooped out. Ever sense I stopped using them I do a lot better with my trades.
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Here is the cold truth.
If you do not use stop losses, you have close to 100% chance of running your account into the ground.
You may win for a while, you may even have a trade or two recover from the depth of hell but eventually you will have a trade that will wipe your account completely out because you wonāt admit defeat and let the loss run your account into the ground,
placing trades without using a stop loss IS GAMBLING. Thatās the truth
Do you drive your car without any brakes? Same thing with trading. 1st thing to learn is Proper Money Management rules find 1 and live or die by it. It is the most important thing you can do in trading, more important that Entries and Exits. I blew out 3 accounts before I learned proper money management.
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So I guess, you close all of your trades in the day, isnāt? How do you manage your trades when you are not available in front of your trading chart?
Sometimes I close in a day. I use the four hour chart so when am not by my computer I just check on my phone. I got a alarm that goes off at the close of each four hour candle.
Money management is the key
Absolutely, it is! No one can make money here consistently without following the rules of money management; whatever the profit ratio he/she has; that doesnāt mean much.
Have you tried using wider stops?
How do you do this? Is this an app or something? TIA!
Impressive example, but I believe itās especially a good advice for newbies and also some experienced traders who use stop loss in every trades.
Sometimes, when you become expert in driving, you will learn how to save fuel by not using brakes, by determining to slow down the road in flow and apply brake only when youāre in traffic or crowd places.
@ Dacity889 I too am curious how you set up an actual alarm for your trades, please share?