When your stop-loss works against you...

If it bugs you when your stop-loss seems to be working against you at times, like giving too much unrealised profit back at exit, or triggering too frequently, resulting in a string of small, but annoying losing trades, this might be helpful.

I deal with this issue by setting a Buy Entry Stop at the previous low less ATR, and Sell Entry Stop at previous high plus ATR. This allows room for a new trade to settle-in without risking too much.

My Buy Trailing Stop is moved to the previous low IF the ask price is more than the entry price plus ATR, and the Sell Trailing Stop is moved to the previous high IF the bid price is less than the entry price less ATR. This means that my stop lags behind sudden trend breakouts and lets them run, but tightens-up at price consolidation areas to maximise profit held should price action reverse and the stop is triggered.

Works for us! 😎

Another good method to use when placing your stoploss is to place it outside volatility, and volatility could be measure using the ATR, good work.