Importance of Stop Loss

in this volatile trading place devoid of stop loss you trading condition can be as like a ship in an ocean without a rudder. So it’s an inevitable part of trading. We have to set stop loss according to previous support and resistance level. However, any form of strategy has different rules in point out stop loss level. Even some traders choose to use manual cut loss. and does not use stop loss tool. Since they are implement scalping technique and always monitoring the trade.

Just reduce your risk and use Stop Loss. Thank you.

You can protect your loss percentage by using stop loss trading tool! I use SL positions in my trading so willingly!

When I was a new trader, then I didn’t use SL; as a result I faced huge losses in my early stage of trading! But now, I am not facing this kind of problem because of using SL’s in my trading! That’s the real difference.

Always use a stop loss. Price can move a 1000 pips in a second if there is some crazy news. Look at CHF a couple of years back

CarlFooty posted:
Always use a stop loss. Price can move a 1000 pips in a second if there is some crazy news. Look at CHF a couple of years back

That was the memorable crash! Many traders even brokers crash their balance during that news session!

Price doesn't just move that much during such news, spreads often get incredibly wide too, which adds to the problem.

AniLorak posted:

CarlFooty posted:
Always use a stop loss. Price can move a 1000 pips in a second if there is some crazy news. Look at CHF a couple of years back

That was the memorable crash! Many traders even brokers crash their balance during that news session!

Such movements of 1000 and + pips may occurs when a Central Bank is intervening on the market - not just regular or usual news. In this case the stop loss does not help, because the trade will be filled on the first possible price :)
I am strictly for the stop loss using and to avoid such movements and bad fills stay away when banks intervene :)

AniLorak posted:
When I was a new trader, then I didn’t use SL; as a result I faced huge losses in my early stage of trading! But now, I am not facing this kind of problem because of using SL’s in my trading! That’s the real difference.

Same experience! I was also tried to avoid SL and trail stop in my beginning trading sessions! But right now I am not! Because, now I am very much sure about the importance of SL position.

Hey. Be honest with yourself and stick to the strategy. If you know how to control yourself and stop trading on time, then you do not need a stop-loss. I'll tell you more, your stop-orders are your psychological levels, which usually come true. Just follow your strategy.

Klem posted:
Hey. Be honest with yourself and stick to the strategy. If you know how to control yourself and stop trading on time, then you do not need a stop-loss. I'll tell you more, your stop-orders are your psychological levels, which usually come true. Just follow your strategy.

That means, you strategy allows you to trade without SL? Then how you handle your losing trades?

Trade with no stop loss Is madness

I, personally, prefer to use stop loss but I generally recommend doing so to anyone who asks me, but there are people who trade without it and do just fine.

There are two ways for me in automated trading :
1 - algorithms that deal with SL and let it hit.
2 - algorithms that use technical SL - far away from opening price - and let the SL almost NOT hit. Internal SL or methods will close almost earlier than technical SL.
Not every algorithm/strategy can deal with 1 AND/OR 2. The more you invest in quality of exit signal the more you can risk as in 2. To be safe with 2, you need to know brokers tickvalue, the risk you will take in sum and a good exit criterion.
I quit method 1 for myself. Hitting a fix SL is just lack of exit signal and hard exit by loosing orientation. I don't like this. Visibile tight SL are just to easy to grab for your broker with a single tick hitting gently yout tight SL. My development EA Cutter uses wide technical SL. And yes it will be hit in backtest, but money management and a good exit algorithm allows me to use this anyway (hopefully).

NicoF1 posted:
Trade with no stop loss Is madness

Absolutely, there is no certainty! I am sure, pro traders don’t trade without SL since they focus on consistency rather than sudden huge profit.

Hey Friends

We use stop-loss orders to prevent big losses on their open stock positions.

Using stop loss is an art. It depends on how much leverage used and when you study chart religiously, it will tell you if using the SL is needed or not. If you follow the above words and attach it with the emotion, it's going to be deadly disaster.

It is probable that your SL is too tight. The market range changes. Your edge could dissappear without any warning if you don't take into account the various market cycles when deciding that your edge is real. Most of times I don't set stop loss because I am expecting something that has been proven to me based on my tests I should expect. In short the plan of the trade is important. Your trades should have been won even before your entries.

I always use stop loss and take profit in trading. Although it does not help me to avoid losses. Anyway, almost all my trades are closed at stop loss. I'm starting to think, should I use them in the trade? Maybe tht's my problem in getting losses.