The Importance of stop loss in forex trading.

[PriceNTime]

Easiest way to understand it is that if you trade without a stop loss then you re putting your entire account on the the line for whatever return you are looking for. This is clearly the wrong approach. Define your risk, make it sustainable and then allow reward to come as it does.

 

[Statoscope]

It was a great read! Stop loss is indeed very important in forex trading for reducing risks of losing unnecessarily.

 

[Paramedian]

Stop losses are a must to limit your losses before they wipe out your capital. Stop losses should be placed with proper planning. There are some common mistakes that new traders make while they set stop losses.
1. Placing stops too tight leaving no room to breathe.
2. Placing stops too far or too wide.
3. Using position size as a basis for stops.
4. Placing stops exactly on support or resistance levels.
We should avoid these mistakes and place stops at an optimum level.

 

[Implumou]

In short, stop losses protect your trading capital. The forex market is a volatile market, and not everything goes as you plan. So to protect your money from the market's volatility and unpredictability, we make use of stop losses. When you use a stop loss, your trade automatically closes after it reaches a value and prevents more losses.

 

[Blockhead]

In forex trading, a stop-loss is one of the most powerful risk control strategies. Using it during a trade will help you prevent larger losses. I never trade without a stop-loss order in place.

 

[Homostone]

I remember the first time I traded without a stop loss. I nearly blew my account, though the capital was small. So, that was an aha moment for me. All traders should use stop loss as it is about protecting your trading capital. If you don’t have money, how will you trade?

 

[Verves]

One can use trailing stops if they think that stop-loss might restrict the profits.

 

[mansuriabubakar7474]

One of the most effective risk management tools in forex trading is stop-loss. Using it can help you avoid larger losses during a trade. I never trade without a stop-loss trade.

 

[TildaTilt]

Stop loss orders are placed at a price level below the current market price and are designed to end your position when the market moves towards that price level. When activated, they trigger an exit from the market at that price level and will automatically cancel any further orders which might be placed at any point before the stop loss order is executed.

 

[Braggart]

I know that there is always a chance of your stop loss getting activated after a sudden change that can make you lose an important opportunity but it can also save you from unnecessary losses.

 

[Teropus]

It might seem like a boring task when you think that you are capable of making money on your own. But I don’t think there should be any issue in using stop loss that will help you in protecting your account from losing anything that you can’t afford to.

 

[Muricide]

Placing stop loss not only helps beginners minimise losses, but it gives them time to understand and learn the market from a better perspective. It is effective and a great way to manage risk.

 

[Masterate]

Stop loss is not less than any protection you have against the sudden market turns. It may act as a hurdle in some situations but in most of them, it will act as a saviour.

 

[Monique Rich]

It’s not mandatory to use stop loss but if you do, you will be able to protect your money from unnecessary losses. And I believe it’s better to lose something that you can afford to lose than to lose something that is beyond your appetite.

 

[Capitation]

Firstly, I don’t have to keep my eyes glued to the screen. Secondly, I don’t lose more than my affordability.

 

[Alexandra Preston]

The most important reason is that it helps to protect your capital. If the market moves against you and you do not have a stop loss in place, your losses can quickly mount up and you may find yourself forced to exit the market at a much lower price than you intended.

 

[Bravado]

There might be no rule for using a stop loss but it’s for your own safety. I mean no one is going to help you recover from your losses. So, why take a chance? Just do your calculations and keep your trades safe from unwanted losses.

 

[Symphony]

I have never tried trading without stop-loss. But once I forgot to use the stop-loss and paid for this heavily.

 

[Bumblebee]

One of the best risk-management strategies in forex trading is stop-loss. Using it can help you avoid suffering more losses during a trade. Without using a stop-loss, I never trade.

 

[Tumultuous]

I do not understand traders who trade without placing stop-loss. I never forget to use one even if I am 100% sure of my trades.