Resolved Question
What is the disavantages of setting stop loss at break even point?
I noticed that when my profit is 7 pips i change my stop loss to break even to avoid losses and make profit but at the long run it will end up not making profit or lose.Please, i want you advise me on how to handle this aspect of trading.
over 3 years ago
Best Answer - Chosen by Asker
The problem may be that when you set your stop to breakeven after only 7 pips, your stop might get hit right away. You have to allow your trade some room to breathe, otherwise you will probably get stopped out a lot and miss out on potential profits.
You might want to consider moving your stop only after a certain number of pips, like 10 to 20 pips. You should also learn how to run your profits. Maybe what you can do is after your first take profit point is hit (lets say 10 pips), close out half of your position, then move the stop loss on the remaining half to make your trade risk free. This would lock in profits and allow you to run the remaining position to see if you can gain even more profits.
over 3 years ago
Answers (1)
You can also choose to place a trailing stop. A trailing stop also allows you to run your profits while minimizing your losses.
over 3 years ago
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