Importance of stop loss placement in forex trading.

[asiaforexmentor1]

FOREX TRADING: IMPORTANCE OF STOP LOSS PLACEMENT



A lot of traders do not believe in stop loss placement.
Some believe in mental stop loss placement. meaning that when they feel that a trade is not going their way, they will then cut it off.
That is so terribly wrong. Stop loss placement is one of the most crucial key if you want to make forex trading profitable.
Another mistake traders make is that they shift their stop loss. They shift it backwards, thinking that the trade will just go back a little more and will come back their way. And sure enough, most of the time, they took more losses than they would have if they stayed on their initial stop loss.
In the chart above, is an example of the importance of stop loss placement.
Usd chf h4
In the highlighted box, thats a pin bar. When some guys see this pin, they will naturally take it down and the ideal place for their stop loss is the horizontal line in orange that is drawn.
Scenario A) if the trader did not place a stop loss, or a mental stop loss – look at how high the usd chf pair went upwards. Their account will be blown or had a huge huge loss.
Scenario B) Trader shifted their stop loss backwards from the initial orange line thinking that the trade will go back down. They would have taken a huge loss as the move went up terribly fast and would have gotten a big blow to their account
Scenario C) Trader sticked to their initial stop loss, they would have just gotten a standard loss of the % risked in their account, based on their money management. And this is just one of the trades among the plenty, therefore this loss is not a big deal.
I hope you guys can see the importance of placing and sticking to your stop loss. Or else your account will be blown before you know it.
Ezekiel Chew
Asia #1 Forex Mentor
Asia Forex Mentor Price Action Forex Course|Free Forex Trading Strategies | System

[kyle101]

Most trading signal system’s have between 5 to 15 different pair’s that they provide trading signal’s for. If you decide to trade all of the pair’s that the system is giving you signal’s for you may end up using a high percentage of your account resulting in poor money management skills, or even worse, resulting in a margin call. Trading signal systems usually provide 3 basic elements for each trade: entry point, take profit, and stop loss.

[katie27]

A great high quality Forex trading software program offers you with real-time currency price updates and digs for market indicators so you do not need to.

[cbhattarai]

I only need to ask question that is the Forex Software similar to the Trader Terminal Software that i use from IIFL...
Thank You

[katie27]

Oh for sure, every forex software has a uniqueness in them for which they term to be the best, but otherwise they are all the same.

[Bestforexpartners]

Hello, The information given above could be helpful for all to trade forex successfully. Thanks for your guidance, I think stop loss placement has a unique role in forex to make the trader's successful.