Are You Getting Stopped Out All Of the Time?

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#524: Are You Getting Stopped Out All Of the Time?

In this video:

00:26 – Do you keep getting stopped out?

00:47 – What are the issues here?

01:32 – Not knowing where to place your stop loss?

02:02 – Trading is emotional.

02:35 – How to avoid being stopped out all of the time.

03:40 – Consider Blueberry Markets

03:48 – Book a call with us and watch my Masterclass

Why do I keep getting stopped out? Today, we're going to delve into that question that has annoyed many a forex trader. So let's get into that and talk about it and more. Right now.

Hey, everybody! Andrew Mitchem here at the Forex Trading Coach with video and podcast number 524.

Do you keep getting stopped out?

Now, are you getting stopped at all of the time? It's a frustrating experience. You've done your analysis, you place your trades you set your stop loss only to find that the market momentarily dips far enough to hit a stop loss and then it goes back in your intended direction. It's like the markets go a personal vendetta against you, right? That's how it feels.

What are the issues here?

Well, let's have a look to see what you can do about that to stop that happening. Because the most common reason that I find that many people have is their stop loss is too tight. A tight stop loss might seem appealing because it minimizes your risk, or so you think on paper, but often it doesn't account for the natural volatility in the market.

Now financial markets ebb and flow. They rarely move in straight lines. So if you're a stop loss is too tight, you're probably going to get stopped out during these minor counter movements. And it's something that you need to be aware of and because not every single time are you going to place a trade that moves straight up into your direction all the time.

Not knowing where to place your stop loss?

The second reason and again, probably a very common reason is because most people don't know where to put their stop loss for each trade they take. Most people use the same stop loss all the time for some reason. Now each market condition requires a different stop loss size. The size of the stop loss should reflect the timeframe of the chart being traded.

The pair been traded, and also the market conditions at the time. Because don't forget, different pairs move in different speeds and different amounts.

Trading is emotional.

And thirdly is emotion and let's face it, trading is an emotional endeavor, and especially when money is on the line. Now, some traders, they move their stop loss because of fear or greed that leads to inconsistent outcomes.

And now a well calibrated stop loss is based on a sound trading strategy and knowing where to put your stop loss and why. Each time. So the danger is if you become emotional, you do things that are erratic. So you need to stick to your plan and don't offer it. Don't change your plan just on a whim.

How to avoid being stopped out all of the time.

So what can you do to avoid being stopped out? Well, here's a few quick tips for you. So is understanding what to do and when to do it. Making sure that your trades have equal risk per trade regardless of the stop loss size. Most people think that they're stop loss needs to be small because that means they're going to lose more if the stop loss gets taken out.

That is not true. We can certainly help you there to understand that a lot more. So adjust your stop loss, adjust your stop loss size accordingly so you can put your stop loss in the right place for that trade at the time you stop losses there. It's a tool to protect your capital. Don't forget that you will get stop that from time to time.

But you need to remember if you've got a good, sound strategy and the trade goes against you,