May 11, 2010 04:34

How big of a stop loss should I use?

Posted In: Forex Q&A
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Hello, I’d like to know how big of a stop-loss I should use and where I should put it? I trade mostly EUR/USD.

6 Comments on "How big of a stop loss should I use?"
  1. Avatar of piphut
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    May 11, 2010 at 04:39
    piphut says:

    It depends on your strategy and the particular trade setup, but I on average use a 50 pip stop-loss on the EUR/USD, and I generally trade off of the 1h and 4h timeframes. I don’t usually go below 30 pips and stay below 75 pips for 4h timeframes. For daily charts I will use 100-150 pip stop.

    As far as where to put it for my trading strategy I put my stop-losses behind a major support/resistance area, or an area where the trend would be changing if it were hit.

    Lets say for example my analysis determines the trend is bearish below 1.3500. I’d then look for a trade where I can hide my stop-loss above 1.3500 and get a good risk/reward ratio (at least 2:1, preferably 3:1).

  2. Reply
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    May 21, 2010 at 20:01
    godfrey says:

    thanks mark for the advice.happy weekend

  3. Reply
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    July 26, 2010 at 10:23
    Emmanuel(Nigeria) says:

    This is great I have learn something invaluable today. Thanks and God bless

  4. Avatar of anastasiakiki
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    January 3, 2011 at 10:58
    anastasiakiki says:

    that sound good

  5. Reply
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    Comment left on:
    March 14, 2011 at 11:43
    Fred says:

    I have recently learned the hard way and got stopped out prematurely, i placed the stop to close not considering the daily range of the currency pair and the Support and Resistance. Will definitely do so in future. Thanks

  6. Avatar of ikehsunday
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    July 5, 2011 at 14:06
    ikehsunday says:

    Mark, thank you for leading the way .

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