Everyone talks about stop loss, but few truly understand how to use it.
The stop loss is not just about cutting losses—it's about protecting your capital and staying in the market to trade again.
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1. Why most traders place stop losses incorrectly and face early stops 🚫
Setting the stop too tight causes you to exit due to normal market fluctuations.
Setting the stop too wide exposes your account to the risk of collapse in a single trade.
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2. Calculate the stop based on market structure and volatility 📊
Use support and resistance levels to place the stop outside the range of normal price fluctuations.
Consider market volatility—a wider stop for volatile markets, and a tighter one for stable markets.
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3. The psychology of endurance vs. cutting losses quickly 🧠
The fear of loss causes many to endure losses for a long time, turning small mistakes into disasters.
Cut your losses quickly to preserve capital, but don't exit the trade due to a slight pullback.
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4. Professional tips: Make the stop your secret weapon, not a burden ⚔️
✅ Define the risk for each trade before entering
✅ Adjust the stop size to fit your strategy and timeframe
✅ Move the stop to breakeven when the trade becomes profitable
✅ Don't raise the stop loss hoping for a price bounce—stick to the plan
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Your next step
The stop loss is not your enemy—it's your shield.
Master it to stay alive and win the bigger battles ahead.
Try applying these principles to the currency below