Stop-loss is an important tool to protect capital during sharp market fluctuations.
You can use one of the following methods:
First idea, fixed percentage: Set a stop-loss order at a specific percentage of the purchase price (e.g., 5-10%). If you bought a currency at $100, set the stop-loss at $90 (10%)
Second, technical support: Monitor support and resistance levels on the chart. Set the stop-loss below a strong support level, as breaking it may indicate a continued decline.
Tip: Do not change the stop-loss out of emotion. Stick to the plan, and reassess it as the market changes.
Always use a stop-loss as part of a comprehensive trading plan, and do not risk more than 1-2% of your capital on each trade.