When I set an order on a 1min tf I set the stop loss for 20 pips (for example) so at max ill lose maybe 20 quid if it goes against me. I want to set and forget in the AM while im at work, so want to read 1h or 4h tfs for that purpose. How would I set my SL for this? Because as you all know charts can drop and rise dramatically throughout the day
Now that’s a question with a multitude of answers.
It would be dependent on where price is, the position of the most recent swing high/low, the ins & outs of the system that you’re using etc.
However it’s safe to say that if you are trading the higher timeframes, your SL has to be bigger (unless you’re getting pin-point perfect entries which, no offence, I am doubting). As for the size of that SL, that’s again down to your system & it’s likely to be trial & error.
For above 01hr you should have a minimum of 50 pips per trade. Don’t forget to check ATR on any pair & your maximum allowable risk level before taking a decision on the stop loss. Because there is a more chance of hitting your SL if you use very small one.
ATR is Average True Range. Depending on the settings that you apply to it, it’ll give you the average range of pips the currency pair moved by per day for that period (so set at 14, it would average the daily range over the past fortnight - assuming w/ends get included).
By using it, you’ll know that if the ATR is 100 pips (the predicted range for a day) & the market has already moved by 40-pips then you can assume that there is potential for another 60-pips of movement.
Awkward to explain (I’m new to this too) but hopefully you follow this.
Yeah, it will crop up in there. They touch on everything in the BabyPips School, the extent of which they delve in to things depends on the subject matter but they do try to give a bit of knowledge on all aspects & then it’s up to the individuals to pick which indicators etc that they like & research further on their own.
Em, I’m going to say “yes” but my answer may not stand up to scrutiny in a court of law. It certainly touches on most things & gives you a solid base from which to progress. It’s a never ending learning curve so you’ll still be learning years down the line so they squeezed what is reasonably viable in to the school to start you off.
Don’t set it based on an arbitrary pip count. Set it instead based on where support and resistance levels are. You can change your position size to have any pip size account for your 20 quid (100 pips or 20 pips- just depends on how many units you trade).
I put a trade on last night with my tp at the resistance level and sl at support. I checked this afternoon and it had took profit at 2.40gbp. I have a 500 account and when the chart was moving up and down it was only going in pence. Any idea why??? Id have thought I would make like 20 or 30 quid?
I’m still going though the school here at Baby Pips but I was reading about calculating profit today and if you go to the bottom if this link, there is a formula to go that