30 Kasım 2022

Where to set the stop loss

There are no break-even strategies for trading on forex, those who argue that it is possible to trade absolutely without losses do not tell the truth. In practice, you can only limit losses by issuing a Stop Loss order.
And to do this necessarily, regardless of the options for trading, with the exception of the strategy of piping, when this is simply physically impossible.

To prove the favor of this warrant is not necessary, he repeatedly saved any deposit from the sink.

Where to set the stop loss the question that always arises first when planning a new transaction, this aspect will be discussed in this article.

The size of the stop loss, the volume of the transaction and the deposit of the trader.

It’s clear that we all come to Forex to earn money, but unfortunately, not all traders have a substantial initial capital, and you want to make a profit right away.

Therefore, most beginners use a leverage of 1: 100 or more, which completely excludes the basic rule of money management forex to set the stop loss amount not more than 2% of the deposit.

How can this value be set in practice if the deposit is $ 1,000, and the volume of transactions is about 1 lot? In this case, our position should be buried, as soon as the loss reaches 2 points, that is almost immediately.

Therefore, this recommendation is suitable only for those who work without using leverage or open transactions with a volume of no more than 10 times for their own deposit. For example, having only $ 100 on the account, the recommended trading volume is only 0.01 lot.

Otherwise, you will have to reconsider your approach to trading, open large transactions and increase the stop loss at least to 10-20 percent of the deposit or use the previous recommendation and be content with the small.
There are a lot of options for setting up this order, but all of them are based on two basic principles the point of installation serves as the place of a probable reversal or the stop loss is used to fix the profit received.


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