eToro – Forex Trading Forum

[Tropezienne]

Stop Loss and Take Profit are ‘orders’ which manage the risk on an open position. They are probably the most important tools that you will use in forex.

From a newbie’s point of view SL and TP help (a) to develop trading discipline and (b) protect profits and minimize losses.

A Take Profit order closes a position at a price more profitable than the opening price. For now I set my TP orders at the same amount as I invest in the position – usually 100 USD – so that I will make up to 100% profit.

A Stop Loss order closes a position that is losing money. Usually I set my SL orders at 50% below my investment – so that I only lose 50 USD if I open a position with 100 USD.

I don’t know whether those %’s are the best and would appreciate advice from more experienced traders.

All of eToro’s trading strategies make it easy to set SL and TP. You should experiment with them on the Trade for Fun platform. Share what you learn!

Julie the Newbie

http://who-gives-a-forex.blogspot.com/

[Tropezienne]

It’s a month now since I started this thread on Stop Loss and Take profit, a month in which I feel that I have learned a lot more about forex. I’m still not confident enough in my abilities to trade with my real money - but it is actually becoming fun for me. I never expected forex to be fun!

So, back to Stop Loss and Take Profit - this last month I have been experimenting with the flexibility of both of these orders. It is very easy to adjust both of them on an open position within the eToro Platform. The really great thing is that the system places an automatic Stop Loss on all your trades to stop you from losing more than you initially invested.

It is also easy to close a losing trade before it gets as low as the Stop Loss. Same with your Take Profit orders.

What is hard is to know when to close or to change an order. If the position is losing - there is always hope that it might swing up; and if the position is gaining pips - there’s always the hope that it will gain a few more.

I guess that disclipline is the key here.

Julie the Newbie

http://who-gives-a-forex.blogspot.com/

[yad99in]

i totally agree with you...........
discipline combined with a strong knowledge base makes a deadly combo...........

[yad99in]

i wish u all the best for your forex trading
do well

[Tropezienne]

Hi there Yad 99in, and thanks for your comments and support of about a month ago - sorry to have taken so long to get back to you.

This issue of good trading discipline is on my mind and I have been putting quite a lot of thought into developing a rule to help me blend good discipline and my trading style. My current trading style involves using the support and resistance trend lines with a dash of ‘gut instinct’.

From my experimentation on my demo account and using eToro’s Trade Box I have set myself one golden rule - always to set my Stop Loss orders closer to the opening price than my Take-Profit orders. My experimentation has proved that if I follow this rule I only need to be right about an open position less than 50% of the time in order to be profitable. I am currently using a 30 pip Stop-Loss orders and a 100-pip Take-Profit orders.

Julie the Newbie -1

http://who-gives-a-forex.blogspot.com/