In foreign exchange trading, traders all know the importance of stop loss. However, it is not easy to stop losses decisively in the operation. The reason is that many traders are lucky and do not want to admit their mistakes. Today, let’s talk about how to stop loss decisively in foreign exchange transactions?
In foreign exchange trading, once the market price reaches the stop loss level set by itself, the trader must decisively stop the loss. If you are indecisive, you cannot stop loss decisively.
How to stop loss decisively in foreign exchange transactions?
First, traders can try to use programs to automate trading. The stop loss point and risk control strategy are preset in the automated trading program, the program will not hesitate like a human, and the operation will be executed cleanly when the set stop loss level is reached. But it also has drawbacks. The strategy development, formulation, and effectiveness of programmatic trading cannot be fully guaranteed, and the current technical level cannot meet the various market trends that allow programs to adapt to the market. Therefore, traders are advised to use this article with caution.
In addition, traders can try to use position control and money management to cooperate with the stop loss to achieve the purpose of decisive stop loss. Another advantage of this is that it can reduce the risk of capital withdrawal and collapse. Senior foreign exchange traders all understand the importance of fund management. After traders do a good job of fund management, they can combine market technical analysis and stop loss to achieve a multiplier effect.
Under such position control and money management mode, traders can resolutely execute after setting the stop loss point, and the maximum drawdown can be reduced from 3% to less than 2%. In this way, the retracement can be well controlled, traders will feel no pressure in the transaction, and the intraday profit range may be 0.3% to 0.6%. Therefore, decisive stop loss coupled with reasonable position control and fund management is the only way for traders to make profits.
How to stop loss decisively in foreign exchange transactions? I gave you a detailed introduction, introduced how to stop loss decisively in foreign exchange trading, and told you the importance of decisive stop loss and its effect on profit. I hope you can apply it flexibly according to your own situation and market trends.