Hi all! Very new here and very new to forex trading so I have some very pressing questions that may seem like no-brainers to the rest of you, but I would appreciate all the help I can get.
My situation is that for the past 2 weeks or so I have been using a demo account for trading (I don’t dare try with real money yet!) and I’m not sure if this is a big difference from using a live account or not, but basically:
I have been trading without a stop loss limit. This is on the advice of a trader who is friends with my family, and he says he never uses stop loss because once the market crosses that threshold you set, your money is lost for good. Whereas if you don’t put in a limit, you can always wait for the market to turn around and rebound. Seems fair enough to me
My question is, using the demo account, I have raised over $3000 so far, but I do this by watching the market all the time, and sometimes (right now for instance) the buys and sells I have are red (negative) meaning my net P&L is at a loss right now. My Balance shows $13,187, my Equity is $13,012 and my Unr. Net P&L is -$175 (negative amount).
I usually just wait for the red to turn to green (indicating a profit) before I close the buy/sell. It adds to my balance, though it may take a while, and I’ve never eaten through it. But is this how it’s going to be with a live account as well? If I don’t set a stop loss limit and my buys/sells go into negative, will I be losing real money, or will the loss only be realized IF I close the position? If I leave the position open until the market rebounds and close it only when it goes green again, that’s okay right? I won’t burn through my funds that way?
I know this is a pretty dumb question to the experienced traders out there, but I’ve only been doing it for 2 weeks now and I feel too embarrassed to ask this in real life. This is the only place where I can get a definite answer.