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Chapter 35, Part I. Why Do We Need Stop-Loss Orders? Page 2

Discussion in 'Complete Trading Education- Forex Military School' started by Sive Morten, Dec 28, 2013.

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  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Commander in Pips: Actually there are two possible ways to act in this case – cut and stop your losses quickly or hold loss positions with hope that the market will reverse back soon and you will able to make profit or at least exit at breakeven. If the market will not do that then it will probably destroy your account.

    We will not talk here about experienced traders, since they trade mostly for profit already and they have accomplished such goals as survival on the market. So they appoint different and greater targets. Here we will talk about newbie traders. As we’ve said already multiple of times, their task in the beginning is mostly to survive or, better to say live to trade. Because as long as they will stay “live” on the market – they will study, gain experience and skew probability of success in their favor. Hence they have to stay strong against any behavior that could decrease “life” on market and by all possible ways decrease the probability of that.


    Second important moment is the level of stress. Holding a losing position without stop-loss protection significantly increases its level, especially if day by day you see rising loss level on your position. When this loss reaches some crucial point of your mind – then you can’t think rationally, you can’t switch to another possibility and that position occupies your mind totally. Besides, it occupies it with uncomfortable feelings and thoughts – it occupies it with greater and greater stress. Do you really need it?
     
    #1 Sive Morten, Dec 28, 2013
    Lasted edited by : Oct 9, 2016
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