Last month a trading friend was complaining like this,

He said that there will be no stop loss in the future, it will either blow up or make a profit...

There is no market today this weekend. Let’s talk about the issue he mentioned.

First of all, contract trading is high-risk, and stop loss must be set for every order.

Either blow or make money, the bad habit of resisting orders, sooner or later the position will be liquidated...

You still need to study stop loss well in order to do a good job in contract trading.

☞Stop loss is generally divided into three situations, namely fixed stop loss, technical stop loss and logical stop loss.

Fixed stop loss

It's easy to understand, it is to set a maximum stop loss that you can tolerate every time you enter the market.

Technical stop loss

It means to use some key points as the stop loss level. For example, when going long, refer to the previous low, and when going short, refer to the previous high. (Or according to the key structural points of the technical form) It should be noted that you can see these positions, and your opponents can naturally also see them, so we often encounter trends that reverse as soon as the market is wiped out. At this time, we can Set some buffer distance. For example, if you short reference the previous high, you can set the stop loss a few points or dozens of points above the previous high. The specific setting depends on the variety. Only by anticipating the enemy can you be in an invincible position.

Logical stop loss

That is, if the predicted trend before entering the market deviates from the actual trend, you can stop the loss and exit immediately. You do not have to wait until the technical stop loss or fixed stop loss is triggered. For example, if you expect the trend to rise, but it falls rapidly as soon as you enter the market but has not yet reached the stop loss position, then you can get out early.

☞Stop loss is important, but not stopping loss is even more important.

On the premise of avoiding excessive stop loss, we should set the stop loss to try not to trigger the stop loss and try not to stop the loss within the reasonable stop loss range. Only in this way can we retain the correct orders as much as possible and achieve better results. Protect profits or protect principal.

It sounds a bit difficult to set a reasonable stop loss and then try not to let the market trigger it. How can it be done?

We can work hard and optimize from two aspects.

If you work hard on these two aspects, the results will be much better.

First, find the optimal entry point. (Be patient and wait for the entry point) In your trading cycle, after entering this entry point, it is easy to go out of the expected market, and it is not easy to reverse, turn back or fluctuate significantly. The market can easily deviate from the stop loss point and develop in a favorable direction, and it is difficult to return to the stop loss point.

In fact, if you have a good entry point, setting a stop loss point that is not triggered as much as possible is not a very wide stop loss. It is probably a relatively small stop loss. If you just enter the market here, the market will easily develop in the expected direction. , although the stop loss is relatively small, it is not easy to trigger. Therefore, entry strategies, methods and skills are the primary factors in optimizing stop loss points.

Second, find the optimal stop loss point. Choose different periods, different positions, and different currencies, and you should set different stop loss ranges or points. Within the tolerable range, reasonable fluctuations and small retracements within the trading cycle must be tolerated, and try not to let the stop loss be triggered easily.

If the 4-hour, daily, single 5-minute, or 15-minute K-line goes in the opposite direction, stop loss should not be triggered under normal circumstances, unless the market has undergone very big changes within this short period of time.

Stop loss too frequently and you will lose everything. So there is a big saying

Those who don’t know how to stop losses, and those who stop losses that are too small or too large are rookies.

However, trying not to trigger the stop loss does not mean stopping the loss.

After setting a reasonable stop loss level, once triggered, stop loss must be ruthless. Even if the market turns back after stopping the loss, don't regret it, there are still many opportunities ahead.

For example, for a 30-minute K-line trading level, when the market fluctuates violently, even if a large-level reversal occurs on the one-minute K-line, the loss should be stopped ruthlessly when the stop loss is triggered instead of waiting for 30 minutes. Read again after finishing. If you have to wait until the 30 minutes have elapsed before dealing with it, it is very likely that the stop loss will no longer be able to be stopped.

If your stop loss method turns back almost every time after the stop loss is completed, it means that there is a problem with the setting of the stop loss point. You should modify and optimize the stop loss plan as soon as possible. Think about whether it is your own entry point and whether there is a problem with the stop loss method. , rather than stop loss.