Stop Loss

[blancspa]

Hi
I am again struggling with stop loss as a part of my strategy. I look at the daily chart to determine trend and then at 4hr for entry. I am running a trade on EUR/AUS (see chart) with trailing stop of 85 pips. Sell at 1.7395
Since I feel that it may be to tight but not necessarily know how to approach the problem.
Can I have advice on this , please?

 

[blancspa]

same here below, after buy at 96.54, I decided to trail stop 85 pips, but afraid the price may pull back before reaching my target. Is my s/l to tight?

 

[Rhody Trader]

What are you basing your trailing stop placement on?

 

[blancspa]

What are you basing your trailing stop placement on?

right I got it
I should rather ask what % of trades respect S/R, is init?

 

[foredog]

same here below, after buy at 96.54, I decided to trail stop 85 pips, but afraid the price may pull back before reaching my target. Is my s/l to tight?

been bouncing of 9650 since 1800 yesterday and low of bar that broker that was 9635 so i'd have stop just below that personally, in my (probably bad) opinion if it pulls all the way back there then there's a good chance it ain't going higher short term.

 

[blancspa]

been bouncing of 9650 since 1800 yesterday and low of bar that broker that was 9635 so i'd have stop just below that personally, in my (probably bad) opinion if it pulls all the way back there then there's a good chance it ain't going higher short term.

yeah , there seems to be old resistance 97.20 area if I can understand right

 

[Rhody Trader]

right I got it
I should rather ask what % of trades respect S/R, is init?

Actually, I was just asking straight up how you decide where to place your stop. Your stop should be based on the underlying reasoning for the trade and expectations for how it's to perform.

 

[Kurrency]

stops are my biggest problem too. hmm good topic

 

[good4life]

I use some percentage of my target profit. For example, if I expect a 100 pip profit, I might initially place my stop at purchase price less 50 pips (a 2:1 reward/risk ratio). As price moves toward my target, I would adjust my stop accordingly.

Just my 2pips

 

[blancspa]

Actually, I was just asking straight up how you decide where to place your stop. Your stop should be based on the underlying reasoning for the trade and expectations for how it's to perform.

yep... my aim was to trail the price from support to resistance. I wanted to place the stop below support yet 300 pips stop kind of huge. so I decided to trail it. but does not seem to be a good idea either.

 

[jiggly]

i dont know how you are trading, or what your strategy is, but when in doubt get out!

I have marked each of your charts with with red 'dots' to give you an idea of the prices where buying and selling pressure may come into the market.

you will have to wait and see how price reacts arounds these levels, which it is at now, if prices dont break these levels marked with arrows you will get stopped out, regardless your stops are in the line of fire, before the market could naturally find support or resistance.....

why did you take these trades, what is your target for each pair?

 

[blancspa]

why did you take these trades, what is your target for each pair?

ideallly the price on each currency pair would reach previous support/resistance areas in the channel USDJPY T98.20, EURAUD T 1.7000, I meant to stay in the trade for few days to 2 weeks.

 

[jiggly]

I use some percentage of my target profit. For example, if I expect a 100 pip profit, I might initially place my stop at purchase price less 50 pips (a 2:1 reward/risk ratio). As price moves toward my target, I would adjust my stop accordingly.

Just my 2pips

do the opposite, decide how much you want to lose first, and at what point your trade is invalidated, then weigh it up against what you could potentially make second. thirdly, carry enough stock to allow you to place your stop at this invalidated level.

remember, its risk vs reward, not the other way around.

 

[jiggly]

ideallly the price on each currency pair would reach previous support/resistance areas in the channel USDJPY T98.20, EURAUD T 1.7000, I meant to stay in the trade for few days to 2 weeks.

I personally think your stops will get hit before your targets, if i was given these open positions to close, I would close them.

 

[blancspa]

I personally think your stops will get hit before your targets,

yep... I have moved them to previous major (channel) S/P levels, I know my entry was not ideal and next time try to work on entry near S/P levels. tx

 

[good4life]

jiggly, thanks for your comments. what I didn't say is that as part of my overall trade plan, I have a max total account loss % that I use. So, I do exactly what you are suggesting/advising. I just didn't add that step. Again, thanks for the attention and advice!

 

[jiggly]

yep... I have moved them to previous major (channel) S/P levels, I know my entry was not ideal and next time try to work on entry near S/P levels. tx

thats better, i think, only if that channel holds true.

 

[jiggly]

jiggly, thanks for your comments. what I didn't say is that as part of my overall trade plan, I have a max total account loss % that I use. So, I do exactly what you are suggesting/advising. I just didn't add that step. Again, thanks for the attention and advice!

no problem, I have been doing this for many years, and it is what I have found to be the best approach.

 

[blancspa]

I use some percentage of my target profit. For example, if I expect a 100 pip profit, I might initially place my stop at purchase price less 50 pips (a 2:1 reward/risk ratio). As price moves toward my target, I would adjust my stop accordingly.

Just my 2pips

hi, I see you use rigid rules of R:R, how does it work for you? I ve read some experienced traders treat every trade in a unique way, like possible minor and major S/R areas on partiular timeframe, startegies depending on targets and sl. When looking at the chart I tend to try to determine 1.where the market is going, 2.where will it stop at best and at worst then 3.evaluate the risk , and if I am happy with it I proceed. Does that make sense?

 

[blancspa]

no problem, I have been doing this for many years, and it is what I have found to be the best approach.

hi, thanks for dropping by. I tend to react to changing market conditions even when carefully designing my strategy and implementing it according to my plan I still tend to change my strategy as trade is in progress. Is this ok?