- 1 Post By Samtastico
The Importance of Stops on your bottom line.
I would like to show you a graphic from my own trading illustrating the importance of planning a trade and allowing the stops and take profits to do their job.
You see the Red Zone is where I watched the screen and moved the stops bigger and bigger behind each lower / higher fib. You see how this effects the results
The Green Zone is where I allowed the original stops to be hit, forgot about them and moved onto the next trade.
Use your money management , plan your trades in advance and don't be scared of getting stopped out ...
Wow where you pulled out so nice trading plan. I am using the same and I was working on it for 3 month. Actually I have worked out a table where different trading vloumes (lots) correlates with different SL and TP. Leverage is also included and keeps risk at level of 3%. I can't afford to lose or from a trade. In case of TP I also use trailing SL about 40 pips for 2 lot trade, just for example. But note that it is hard to keep the things balanced if you get slippage on your trades, bringing in kinda of disorder in your calculations. Thankfully my MercerFx standard account doesn't experience such disturbances or has it very rarely, so I can stick to my trading plan more or less successfully
Personally I give much attention to the amount of the amount I risk in this business but after losing some position that I was right about during analysis I realize the important of money management and ever since I only make use of 2% or 3% of my investment on any pair am trading, the good thing about money management is even give opportunity to make more money on the market. and this are to prvent the worst case for any traders, the margin Call. it's important to check the brokers trading condition, different brokers giving vary margin calll level and stop out level, well got one account with armada markets given condition Margin call / stop-out: 100% / 30%.