Stop Being Stopped Out in Forex
Are you constantly being stopped out in Forex? If you are always unexpectedly finding that your trades are closing due to hitting the stop loss level, you might be doing something wrong. Today we are here to find out how to avoid being stopped out in Forex trading, and how you can make your profits increase significantly.
Stop Loss & Stopping Out in Forex
The first thing we should cover here today, before getting into what it means to be stopped out in Forex, is what a stop loss order is. After all, the two are very closely related, and using stop loss orders the wrong way can indeed result in being stopped out in Forex.
In layman’s terms, a stop loss is an order placed with a broker, which can be on a buy or sell order, which causes the trade to close when the price moves up or down past a certain point. As you might be able to tell from the name, this kind of order is designed to stop losses from occurring, or at least to close trades automatically when a certain amount of money has already been lost. In essence, it’s a form of damage control to stop a losing trade from continuing to cost you money.
As an example, if you place a buy order on a Forex pair, and you expect the USD to go up in comparison to the CAD, and you enter the trade at $50, you might set your stop loss level at $25. This means that if the position decreases in value, so in this case, the CAD goes up in value compared to the USD, if the price goes down $25, the trade will automatically close, and keep you from losing the other half of your trade investment.
Now that you know what a stop loss order is, we can go over what it means to be stopped out in Forex trading. Stopping out can refer to an order which closes due to a set stop loss level. However, what being are really referring to when talking about being stopped out in Forex, is when many trades unexpectedly hit that stop loss level and close.
When you have way too many trades hitting their stop loss level, very unexpectedly, it means you are stopping out in Forex. This can lead to some really major losses, and you therefore need to figure out why you are being stopped out in Forex. Below, we want to talk about some remedies to this problem, and how you can avoid being stopped out in Forex trading.
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Stop Being Stopped Out in Forex
Ok, so you keep being stopped out in your Forex trading, and it’s costing you a monumental amount of money. That said, stopping yourself from being stopped out in Forex trading is easier said than done. Realistically, if you are an experienced trader with some decent knowledge in your arsenal, this should not be happening.
Unfortunately, constantly stopping out is something which often happens to newbies who don’t know how to set stop loss levels properly. It’s a problem that’s not too hard to avoid, but nonetheless, a problem that keeps occurring, especially for beginner day traders.
Now, what we do want to say here is that it is much easier to grasp these tips and strategies for setting a proper stop loss level by watching the featured video. Yes, we are going to go over the most important tips to prevent you from being stopped out in Forex trading. However, it is much easier to grasp these concepts if you watch the video from Andrew’s Trading Channel. This stuff is always easier to understand when you can see it happening right in front of your eyes, complete with visual examples.
At any rate, here are the most important tips for you to follow to avoid being stopped out in Forex trading.
- A mistake which many people make is to base a stop loss level on some kind of complicated and convoluted mathematical equation. Folks, you should not be using some kind of complicated math equation to figure out a stop loss level. This often results in losses, and it’s definitely not a good way to avoid being stopped out.
- Something you should always do to avoid being stopped out in Forex trading is to plan your stop loss level ahead of time. This is not the kind of thing that you can figure out at the last minute, and it’s definitely not a number you should be coming up with at random. This is something that requires planning.
- When it comes to timeframes, if you hope to avoid being stopped out in Forex trading, never base your stop loss level on a single timeframe. Whether you are using support and resistance or moving averages to determine your stop loss level, don’t only use a single timeframe. There are many timeframes to work with, and you should be using a lot of them, not just a single one.
- Another way to help avoid being stopped out in Forex trading is to not move your stop loss level after you have set it, especially if the trade is already open. Once the stop loss is set, leave it, don’t change it, or else you will probably end up losing money.
Learn Day Trading from Andrew’s Trading Channel
Something we do want to mention on the side is that how to avoid being stopped out in Forex trading is by far not the only topic covered on Andrew’s Trading Channel. Andrew is of course the leader of the Income Mentor Box Day Trading Academy, a full scale day trading school.
His YouTube channel features hundreds of useful tips, guides, and tutorial videos, along with live trading videos too, all about Forex, stocks, CFD, and more. It’s a great way to brush up on your day trading skills, and if you catch the live streams, you can even copy trades as Andrew places them, thus allowing you to bank some profits while you learn from one of the biggest experts in the business.
Stopped Out in Forex – Conclusion
The bottom line is that if you follow the tips discussed here today, and you watch the video in regards to how to avoid being stopped out in Forex, you trading results should greatly improve. If you really want to become a professional and profitable day trader, learning from the best at the Income Mentor Box Day Trading Academy is recommended.