Let me guess.
You’re placing your stop loss below support and above resistance.
Then you realized you’re getting stopped out of your trades way too often…
…Only to watch the markets reverse back to your intended direction.
Well, fret not.
Because you’re going to learn a simple concept that allows you to set an effective trading stop loss.
Whether you’re trading Support & Resistance, chart patterns, breakout, pullbacks etc. This concept can be applied universally.
It’s what I call… “Placing your stop loss where your initial trading idea is invalidated”.
Once you’ve understood it, you’ll learn how to set a proper trading stop loss, so you don’t get stopped out unnecessarily (and improve your trading results).
Now… go watch this training video below, where I’ll explain it to you step-by-step:
I hope you have enjoyed this week’s video post. As always, comments are welcomed and encouraged. Cheers!
Do you want to learn a new trading strategy that allows you to profit in bull and bear markets?
In my FREE trading course (valued at $48), I will teach you this powerful trading strategy step by step, along with charts and examples.
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Thanks again Rayner for your sharing.
These 3 ideas of putting SL really make sense, however I think these are quiet large SL taking many pips.
It’d be great if you could explain your 2ATR SL comparing to these SLs your share on this topic whether which type of trade would fit best on 2ATR or S/E or even dynamic from 20EMA.
Thanks alot man, Phum
How about placing a stop loss using Fibonacci support levels?..
Is this recommended?
The concept can be applied as well.
If you’re using Fibonacci as a means for an entry, when the entry is invalidated, it’s time to exit the trade.
Thank you for your feedback.
Yes I think that would be a great suggestion for a future post.
Regarding using ATR for stoploss, you can check out this post here.
How about stop-entries on stoploss cascades (market microstructure)?
Sorry but I don’t understand your question.
Thank you Rayner!
You’re welcome Shlomi 🙂
If i still want to keep my risk to 2% of account size, and the SL position where my entry decision would be invalidated will result in a bigger loss than my 2% limit, what should i do?
Hi Teck Leong,
You need to reduce your position size in this instance.
This video here will explain more.
Let me know if that helps!
After many months of research i am ready to fund my account for 3,000 dollars.
I read somewhere to risk 2%, but i know forez is a little different.
How much risk per pip would you suggest when making a trade?
I would suggest 1% be more conservative.
Risk per pip will be relative to your stop loss size.
Use this position sizing calculator to find out…
Several times I have experienced that my trade was correct but a wave suddenly kind of wipes off my SL and then again continues back in my direction.
I know what you mean, Natasha.
Thus, giving your stops some room to “breath” is important.
I just want to say thank you for your videos. They are full of good information and right to the point.
Regarding the SL, can we also base on swing highs and lows for eg.. 2 swing highs or lows from the entry? What are your thoughts?
Sure that’s another way to do it.
But I’ll give it some buffer away from the high/lows.