Stop Losses- how do you use them - and why do prices Spike ?

[Pharaoh]

I determine my stop loss levels depending on the volatility of the market and the swing highs and lows that the instrument has done. If I go short, I will place my stop loss above the most recent high, regardless of the time frame. If I go long I will put my stop loss below the most recent low.

Good strategy, but make certain to put your SL far enough beyond those support and resistance levels. Imagine if you were a "big fish" in the market and you realized that a large number of people had stops only a few pips beyond the most recent swing high or swing low? Imagine if you were a broker that was willing to manipulate price feed by just a few pips and the market approached a level where many clients had a tight cluster of SLs set.

 

[peeterwoolf]

Good strategy, but make certain to put your SL far enough beyond those support and resistance levels. Imagine if you were a "big fish" in the market and you realized that a large number of people had stops only a few pips beyond the most recent swing high or swing low? Imagine if you were a broker that was willing to manipulate price feed by just a few pips and the market approached a level where many clients had a tight cluster of SLs set.

Good point.

 

[downtrend]

It requires a lot of things before you start placing proper stop losses in your trades. It also has a lot to do with pair that you have chosen to trade. Some pairs are more volatile and thus requires a large stop loss.

 

[iMusingKiMi]

Good strategy, but make certain to put your SL far enough beyond those support and resistance levels. Imagine if you were a "big fish" in the market and you realized that a large number of people had stops only a few pips beyond the most recent swing high or swing low? Imagine if you were a broker that was willing to manipulate price feed by just a few pips and the market approached a level where many clients had a tight cluster of SLs set.

I am absolutely agree with this point. If so easy only text books reading of putting SL, there are no one always blaming broker for stopping them out with some sort of spikes. It is all about how you read the Price Action and experience person know where the Supply and Demand are.

 

[iMusingKiMi]

It requires a lot of things before you start placing proper stop losses in your trades. It also has a lot to do with pair that you have chosen to trade. Some pairs are more volatile and thus requires a large stop loss.

This point is good as well. Let's take the major currencies on EUR/USD and GBP/USD. A lot of amateur love to trade on the Cable because of its noise.

U.S. Dollar Index - Wikipedia, the free encyclopedia

If someone is familiar with this, they don't like to trade Cable due to their noise and figures shown that it is more profitable to trade EU instead of Cable. Trade Cable only with its own true strength and weakness, otherwise you have to put higher SL for those unpredictable noises and it might chopped you out easily with those noise.

 

[downtrend]

Using stop loss is very important. How do I use them is that I place my stop loss at the last low or high according to my trade entry. Also if I entered any trade on the basis of pin bar, I place my stop loss below that pin.

 

[forbroker]

John T
I have tried for months the method that you have described (letting run without SL) and can say that it worked very well when I first tried ON DEMO ACCOUNT. But as soon as I shifted to Live account....Nyet....Nada......would not work. Moreover as soon as I had placed my 10 trades on the live account it became an uphill battle to keep trading THE PORTFOLIO up only to see the PORTFOLIO siiide back down again a few days later....repeat repeat repeat...
When I complained to broker....his only response was that traders are nervous on Live as opposed to on Demo...(which is also what 99% of traders and teachers say also)
Well that is hogwash becasue my method did not require me to sit and watch I simply found a trend or some kind of extreme low or high and set a short at the top of the chart/market and a long at the bottom and went fishing...checking in days or weeks later.....same as trapping animals....no nerves involved.
Then I read an article from Google where a guy described PLUG IN SOFTWARE. This is software that brokers plug in to delay your trades by 5 seconds or widen spreads to trigger or send out ghost candles to trigger or completely make a successful trade disappear....and much more......not all at once of course.
Which is why I left FXDD after seing before my eyes one of these ghost candles reach down to my SL about 1.5 inches long and trigger it, and jerk off back to where it came from. Now I am with Axitrader whuich will not respond after I asked embarrasing questions...
If you check Wikapedia you will read what a totally infested thing this Forex has become...from the brokers to the Instructors to the quick fix software sellers all leaching off hopeful traders. Is it any wonder that 97 or 99% of them fail?.
If there is any way that 1% of traders can win in this crowd of cock roaches I admit to not knowing their method.
I believe that a software might be able to skim a small percentage off arbitrage, but who WHO could one trust to buy that from.....none are trustworthy in such a latge crowd on outright crooks and criminals ALL SUPPORTING ONE ANOTHER. And just so you know I only lost $1000.
Truly I am an experienced stock and options trader, and not stupid. I watched traders at the Apiary Fund school of forex demonstrate a session of live trading whereafter they had promised to buy all in attendance pizza from the winnings. Well guess what there were no winnings and no pizza.
With only one year of intensive forex training and experience I am tempted to say that the winnings were made some years ago in the first days of Forex...and BIG.
But now I think there are only liars and scammers inhabiting this world....and noe will admit to their level of earnings.

 

[iMusingKiMi]

John T
I have tried for months the method that you have described (letting run without SL) and can say that it worked very well when I first tried ON DEMO ACCOUNT. But as soon as I shifted to Live account....Nyet....Nada......would not work. Moreover as soon as I had placed my 10 trades on the live account it became an uphill battle to keep trading THE PORTFOLIO up only to see the PORTFOLIO siiide back down again a few days later....repeat repeat repeat...
When I complained to broker....his only response was that traders are nervous on Live as opposed to on Demo...(which is also what 99% of traders and teachers say also)
Well that is hogwash becasue my method did not require me to sit and watch I simply found a trend or some kind of extreme low or high and set a short at the top of the chart/market and a long at the bottom and went fishing...checking in days or weeks later.....same as trapping animals....no nerves involved.
Then I read an article from Google where a guy described PLUG IN SOFTWARE. This is software that brokers plug in to delay your trades by 5 seconds or widen spreads to trigger or send out ghost candles to trigger or completely make a successful trade disappear....and much more......not all at once of course.
Which is why I left FXDD after seing before my eyes one of these ghost candles reach down to my SL about 1.5 inches long and trigger it, and jerk off back to where it came from. Now I am with Axitrader whuich will not respond after I asked embarrasing questions...
If you check Wikapedia you will read what a totally infested thing this Forex has become...from the brokers to the Instructors to the quick fix software sellers all leaching off hopeful traders. Is it any wonder that 97 or 99% of them fail?.
If there is any way that 1% of traders can win in this crowd of cock roaches I admit to not knowing their method.
I believe that a software might be able to skim a small percentage off arbitrage, but who WHO could one trust to buy that from.....none are trustworthy in such a latge crowd on outright crooks and criminals ALL SUPPORTING ONE ANOTHER. And just so you know I only lost $1000.
Truly I am an experienced stock and options trader, and not stupid. I watched traders at the Apiary Fund school of forex demonstrate a session of live trading whereafter they had promised to buy all in attendance pizza from the winnings. Well guess what there were no winnings and no pizza.
With only one year of intensive forex training and experience I am tempted to say that the winnings were made some years ago in the first days of Forex...and BIG.
But now I think there are only liars and scammers inhabiting this world....and noe will admit to their level of earnings.

It is always not easy to replicate your trade and strategy from DEMO to LIVE. Forex Price is driven by human themselves, not broker.



Listen to this.

 

[bigdolly]

John T
I have tried for months the method that you have described (letting run without SL) and can say that it worked very well when I first tried ON DEMO ACCOUNT. But as soon as I shifted to Live account....Nyet....Nada......would not work. Moreover as soon as I had placed my 10 trades on the live account it became an uphill battle to keep trading THE PORTFOLIO up only to see the PORTFOLIO siiide back down again a few days later....repeat repeat repeat...
When I complained to broker....his only response was that traders are nervous on Live as opposed to on Demo...(which is also what 99% of traders and teachers say also)
Well that is hogwash becasue my method did not require me to sit and watch I simply found a trend or some kind of extreme low or high and set a short at the top of the chart/market and a long at the bottom and went fishing...checking in days or weeks later.....same as trapping animals....no nerves involved.
Then I read an article from Google where a guy described PLUG IN SOFTWARE. This is software that brokers plug in to delay your trades by 5 seconds or widen spreads to trigger or send out ghost candles to trigger or completely make a successful trade disappear....and much more......not all at once of course.
Which is why I left FXDD after seing before my eyes one of these ghost candles reach down to my SL about 1.5 inches long and trigger it, and jerk off back to where it came from. Now I am with Axitrader whuich will not respond after I asked embarrasing questions...
If you check Wikapedia you will read what a totally infested thing this Forex has become...from the brokers to the Instructors to the quick fix software sellers all leaching off hopeful traders. Is it any wonder that 97 or 99% of them fail?.
If there is any way that 1% of traders can win in this crowd of cock roaches I admit to not knowing their method.
I believe that a software might be able to skim a small percentage off arbitrage, but who WHO could one trust to buy that from.....none are trustworthy in such a latge crowd on outright crooks and criminals ALL SUPPORTING ONE ANOTHER. And just so you know I only lost $1000.
Truly I am an experienced stock and options trader, and not stupid. I watched traders at the Apiary Fund school of forex demonstrate a session of live trading whereafter they had promised to buy all in attendance pizza from the winnings. Well guess what there were no winnings and no pizza.
With only one year of intensive forex training and experience I am tempted to say that the winnings were made some years ago in the first days of Forex...and BIG.
But now I think there are only liars and scammers inhabiting this world....and noe will admit to their level of earnings.

Give up with automated software and wasteful indicators they expose your account to extra risk without extra potential reward. Market are constantly changing but software works on the same algorithm which sometimes can't take into account extra market conditions. that's why I prefer fundamental trading with minor incorporation of basic technical methods such as S&R.

 

[iMusingKiMi]

Forgot to explain why Spikes happen. I think this is good explanation.

You are selling Banana. Trader A and Trader B selling Banana as well. If you wanna increase your sales, what will you do when Trader A offer USD 1 and Trader B offer USD 0.95? Of course you wanna pitch USD 0.90 to buyer, don't you? But the last buyer comes in and buy from Trader B pitch before yours, hence your price will become a spikes in chart.