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I have been trading for more than 15 years. I can guarantee you that the single greatest error that a trader can do is to ignore the risk he is willing to take. Risk management necessitates the use of stop loss orders, either inserted into the platform or mental, it is the same. Ignoring risk leads to catastrophic losses. It is not related to 'if' but only to 'when'. It is simply a matter of time when exactly you will be blown out. If you are constantly stopped out, then it is absolutely certain that you are doing something wrong with your risk management. It's not your stop loss orders that are wrong and need to be omitted, it is your whole strategy that requires amendment.
Many words of wisdom. I blew up a few accounts when I started out by trying not to lose. Became profitable once I realised and accepted that I needed to learn to lose before I could win. Sounds nonsensical, I know but it is a fact. Another gem was learning that successful trading was not about being right.........It's about doing the right thing by sticking with your trade plan and your strategy. You will have losses and you have to accept them.
If you’re a Scalper you can’t afford not to use a tight stop loss. If you’re a Swing trader, this may work for you. I think it depends on what kind of trader you are.
Stop losses are advertisements for the institutions. You're showing them where liquidity is and they will move price to snatch you up. Chances are you're putting the stops where most traders put theirs and when the big boys see batches of liquidity above or below support/resistance, it's a perfect opportunity for them to do their business efficiently.
The best way to protect your trades is by keeping a low lot size. So when it goes against you, like way against you, you can still weather the long storm and wait for it to come back. It isn't about stop losses, it's more about lot sizes.
VERY true, instead of placing an unrealistic tight stop loss, just reduce your share size and allow your trade room to swing back and forth. Your stop loss should always be based on previous support or resistance and those are not always in a tight range.
I have personally papertraded the exact same stocks at the exact same time on different platforms. I have found that it is true. It took me years to break this habbit because it was one of the first things I learned. You manage risk by your position size.
Stop losses should only be used when you are not actively watching your open trade, if you are at your computer or phone watching your trades then there is no need to have stop loss points.
Your stop loss protects your account from blowing up. If you have even a decent algorithm that you test over and over you shouldn’t hit your stop loss often at all, even while keeping your risk at or below 2% of your account. If you keep getting stopped out, the problem is your system, not your stop losses. If your stop losses truly are “too tight”, then your actual problem is money/risk management.
This man is telling the truth. Tight stop losses is an idea that is designed mostly to benefit the brokerages/exchange/investment banks. Their objective is for you, the retail investor, to make as many and large trades as possible which makes them money every trade and also provides them the liquidity they need to turn your losses into their gains. They have a major conflict of interest when they encourage you to do certain things and tight stop losses is a perfect example of it.
I agree completely. Many trades I've done, I was always stopped out. The key for me was to have minimum capita with lower lot sizes and trade long term only.
I thought I was an irresponsible madman because I average down my stop losses and keep an eye on the chart doing that manually, finally someone that made me feel less alone at the battle field, thank you Mr.
I actually agree with him. One trade I was in I set the stop lose about a mile away because I was in fact confident in the direction it went negative about 21k but I knew it would turn and it profited 11k in the end👍🔥
This guy is super right. When I started trading newly I had reservations about putting stop losses since I monitored my trades a lot and then I decided to use stop loss suddenly I lost more using stop losses more often than necessary and most times the trade eventually went in the direction of my prediction
The week I stopped using stop losses but instead monitored my trades and closed them manually when the prices reach where my stop loss would have been, I made 30% on same strategy that was making 2%.
How? That doesn't make sense to me. According to you, your stop position either manual or automatic was in the same spot. Could you explain this please? All the best!
literally the exact same thing as using a stop loss.... so, insted of setting your stop loss, you mentally set it then adhered to it. exactly the same strategy. this is some misinfo right here. someones trying to set up the public to feed their own strategy.
Absolutely right. Day traders blow up their accounts only due to the tight stop losses even though they may have got the direction right. Its frustrating.
How to use stop loss- depends on your trading set up and analysis: How far would the market have to move against your intended entry area for you to decide you were wrong? Your stop loss should be outside that zone. If the distance huge, you need to wait for a set up where your stop loss distance is smaller. Some people use too tight stop losses, but you should always have a stop loss of no more than you are willing to lose in one trade, or in one day. To go without using any stop loss is asking for disaster.
Coming from an individual who's not a profitable trader sounding as if he's a pro, I can't accept that. Mostly 90% of Trader's aren't profitable and you've just stated what 90% of traders do, so your comment holds no verifiable merit.
Mlogan11 Yes, I think he’s specifically talking about equities, ETF’s, generally slower moving than FOREX. Most people getting into trading seem to be drawn to FOREX, and certainly when new to trading you need tighter stop losses, even just to give yourself a chance of not wiping out your account early on. In terms of size of stop loss, he’s not taking about not having a stop loss. He has one but it’s not tight. So within a day he will override and close the trade manually before the stop loss is within range anyway - if he feels he got it wrong in the first place. He’s obviously medium range trader as mentioned. And presumably confident, competent and used to getting the call right a lot of the time. I do know of people who are well against quick return and much more about long term wealth growth. Bottom line. Until you’ve got a bit of time and successful trading under your belt, you have to protect yourself with reasonably tight stop loss. Or more to the point, trade virtual until you’re more than confident you’ve progressed to a point where you’re are consistent enough in your successful trades. Once there is consistency to you should be able to work out what risk tolerance suits your trading style/method. The instrument and time frame your trading also being major considerations.
When I was first learning about stop losses.. that's the first concern came to my mind.. what if there's just flash pulls/pumps for split seconds? What this guys saying is ABSOLUTELY right. DO NOT use stop losses. Always keep an eye on the market. Do not sleep with your open position (w/ high margin/leverage ofc)
Too tight stop loss is bad, too wide stop loss is bad too. To find the optimal stop loss, one needs to backtest the strategy or find out the hard way by trial and error.
Not putting a stop in the market is different from not having a stop in mind. Not using a tight stop is different from not using a stop at all. If you know the reason you put a trade on, you know when that reason no longer exists or has failed. If you know your support and resistance and trend patterns and what you're trading within and you're not overextended, you can choose to take a fast loss or gamble on a bounce.
Also the problem is that people are not precise with their entries, you need to enter in a very tight precise entry signal in a SHORT TIME FRAME, that goes in the direction of your long time frame if you are looking into a longer time frame trade. That way you can put your stop really tight and are not just entering in the middle of nowhere because you have no idea whats happening in the smaller time frame, remember everyone talks about lagging indicators well looking at a 1 hour 3 hour daily chart is a lagging indicator by definition, go into the smaller time frame and do the same thing you are doing in the larger time frame, find a entry signal where you can put a tight stop and is going in your direction so now your risk to reward ratio is huge and your risk is very small! then as soon as you can move the stop to breakeven, now you have a ZERO RISK TRADE!! its not risk management its about RISK ELIMINATION! you don't want to manage the rats in your house you want to eliminate them, first minimize the risk, then you eliminate it for ever , now your trade has zero risk.
Do the fundamentals analysis, decide which way the market is going. Then build a position. If your in the red but your conviction is that the market is going to come good then add to your position. Keep your position sizes small and manageable and have a cut off point where you kill the trade but give your stop loss plenty of room. Key thing here is to build your position rather than just going in heavy right from the start.
A sincere advice to you guys who are watching this, use a stop loss at every trade! If your stop loss get taken out alot, you will need to relearn where to entry at a better price and avoid putting SL at obvious support and resistance area, you will thank me in the future.
Say no stop losses, is essentially saying don't get out of a trade until it works. That's a recipe for disaster and blowing accounts. Take the loss and live to trade another day. If you stop losses are stopping you from making money, than it's not the stop loss it's the trade.
At first I thought it means, never to use stop loss in all cases. I appreciate that he mentioned not to use too tight stop loss and that if you are confident that you’re trading in the right direction, dont use it. If youre not confident, dont do that trade at all.
After being stopped out TOO many times, I finally stopped using them and instead I put AUTO ALERTS on my positions instead, so only I know where my stops were instead of the Market Makers knowing and letting them manipulate the prices down. Now, when a price goes against me I am alerted by my platform so I can look at it to see if the Volume to Price (VPA) is indicative of market manipulation or just recent news that is causing a dip.
He's right - a tight stop loss will take you out too soon and you will lose $$. Best to set a stop loss of 20-25% against the former high, adjusted against the ATR (average trading range), and in this way you let your winners run and your exit - if triggered by the stop loss - won't be at the high but you will make $$ on your exit. Your entry needs to be into an upward trend.
This makes perfect sense. Upon looking back at my trades, most of the times they go in my direction either shortly or a little after getting stopped out.
best choice!! for example, I had bought at a certain price. Then it crashed down a lot but I held and now it is back at my price again with an uptrend. Mental stop loss is best!
Wow! I totally agree! I started losing money only because of stop losses. Now I just watched a video that makes sense. Set stop losses when in profit! You lose before you start winning and where that drops before the win is unpredictable.
Without Stop loss most of the traders will blow their account, which most of the newbies do.but with Stop loss you stay longer in the game and hopefully learn. Stop loss should be at the place where if prices go it changes the anticipated structure of the market, where the price should not be if you were right.
my stop loss used to get triggered by the market maker spiking the price in one direction or the other. once this happens to you a couple of times, you realize the stop loss may not be your friend.
I find this to be very true. Most times once your stop loss gets hit, price usually reverses to your intended direction. This happens more than 90 percent of the times when I use tight stop losses.
I use stops always.. the msg here is simple, place any stops outside the normal volatility range relative to the time frame in which your trading. I'm always wary of people like this encouraging inexperienced traders not to place stops rather than teaching them where to place their stops.
he's right, the market makers have way more data than you do as a retail trader and they can see your entry points.. like level 2 data in stocks. they will push the market against you. stay liquid and be able to rid out "static" higher timeframes are best. long term positions, bankers aren't watching the market like retail traders do, they're working, its a job to them and its long term weekly to monthly and even yearly targets
Depends the time frame you're trading at. If you're trading the 60 min, 2 hours you should know if the trade did what you wanted it to do. If it didn't, get out - take the hit.
I only had problems with hard stop losses before I fully understood price action and my strategy. IMO problems with stop losses have more to do with not fully understanding price action and the pulse of the market. Every trader is different so if stop losses don't work for you then don't use them and vice versa. I know plenty of people who have blown out accounts from not having a stop loss, confident a trade would "eventually" go in their favor and couldn't determine when to cut the loss. The size of the account didn't make a difference. They suffered from lack of experience and/or ego. There is no one size fits all solution. Learn yourself and what works best for you and you will find maximum success in the market.
Using a stop loss is like playing poker and showing everyone at the table your hand....never use a stop loss...it is the way wall street professionals pick your pocket !!!!
There’s much risk involved, most traders are searching for that elusive method where they never lose or can win eight or nine trades out of 10, amassing huge profits in a short amount of time with no risk.
Totally agree about stop losses. From my point of view the thing consists in risk management, if the size of your position, the size of your lot is compatible with your account balance. Period.
Im a day trader, guess what? I use super tight stop losses and i didn't get stopped out that much, by making sure that the market condition is not entirely chaotic and find a good entry, it take patient to do so but the return is worth it.
if you have an edge that requires a predetermined loss per trade, stopping out at defined levels is necessary to allow for the positive expectancy to materialize
Stop loss orders can be your biggest enemy or your biggest ally. If you don't where to put them and how to magage them, you are going to be manipulated by the large traders. If you put them in the right places, you will be able to trade WITH the large traders.
Well, at the same time, many novice traders lose money because they have faith that the market will go in the direction they have predicted, when markets go against them. Truth is, novice traders have to know where they should exit the markets, this is extremely important, using stop loss or not.
I notice this in crypto constantly. Price will start to move in an obvious uptrend, get knocked down 2-3%, stop out all the tight wads who actually picked a good spot, and then go nuts from there.
Stop losses are a scam. NEVER USE THEM. Market will go lower just to trigger your stop loss to take you out and then go back up. Instead, simply set alerts and then act manually when the time comes.
Exactly correct. He is bold enough to say the reality about stop loss. I thank Andre Minassian for his explanation. I appreciate the beautiful anchor also (sorry, I dont know the name) in this video. Keep uploading such videos for helping the traders, who get losses due to stop losses.
He's right about tight stop losses losing traders money. Securities and Forex are always whipping up and down - especially Forex. Traders using tight stops will almost always just end up losing money. Better to avoid buying the underlying altogether and just sell Options on them.
Fact...i lose more when i put tight stop loss, not giving enough room for stop will put you out in the game. put your trade when the price is going to pullback with a stop that will hit the support.
Believe me, trading with out stops is like going to a war with out a shield. you may kill 100s, but surely one bow will kill you. you are trading not to kill your account, but to make money.
stop loss is the biggest scam in this industry, here is an entity that knows that x many people will win and ask her for the prize and know also that these would be winners have a hidden secret (the stop loss) if used against them they will give up on the prize, what do you think this entity will do in your right mind?
Pretty simple really. I usually have a 2% stop loss in trades that I'm confident on. They nearly always never get there before going back up. The ones that do keep going, usually a stock dump
Even if you have a tight stop loss, and it gets hit, you can always get back in the trade at a later time, which may be better for you anyway. With a real large stop loss your risking way too much.
etaylor38 Exactly. They are tagged on upthrusts, downthrusts and then the market reverses to your direction. There is no way to control or predict them, watch out for market openings, news releases that’s when they like to do them. And then re-enter to your direction on a spike.
but then your taking losses which 1. affect the mind and 2. affect the balance. if you put in a stop and get stopped out are you really going to be as confident adding another position on that trade? i don't think so. Yet better risk less, use no stops and massage an area with 3/4 positions equally overall the % your willing to lose then manually watch over the trade. The only thing i use when trading is TP levels in case am not at the charts and it hits the TP level i was aiming for.
I've never profited from trading, so take my opinion with a grain of salt: It's all about context. It's obvious from the video description and the video itself that this guy is a medium-term trader. This is where his observation comes from, and he's absolutely right. BUT, if you're a day trader, you want a tight stop loss due to the volatility and presumed limited market exposure in your strategy. With consistency, your tight stop loss will pay off.
While setting stop losses in the noise (ie too tight) is a terrible idea, setting stop losses with proper consideration of market volatility is the only way to consistently make money in the market. Going all in will eventually kill your profitability with a few bad trades.
That's the truth; intuition has a lot to do, the maket owners know your stop losses so they can take you out.. You have to be sure about what you trade or not
The best statement I have seen on this subject is to put the stop loss at a place where you know for sure the trade is not working as you expected (max 2% risk of account equity). And definitely NOT 'just below support' or 'just above resistance', as that is where everyone in the FX industry is brainwashed to put them and that is where the big money is looking to take out your trade for their benefit.
A Stop Loss will not protect you in case of a gap down then, you lose your shirt even with a Stop Loss. Buy a Put Option which gives you better protection with leverage to boot!
Stop-losses is for traders who simply don't know what they're doing and, unfortunately, most traders don't know what they're doing. And if YOU don't know what you're doing it is better to use Stop-Losses. Even those self-appointed Gurus on RUclips don't know what they're doing. Since I've learned about Patterns, The Elliot Wave Theory, the difference between an Impulse Wave, Motive Wave, ABC Correction, Prechter, Ending Diagonals, Wedges, Triangles, Gann Theory, Pivot Tables, Moving Averages, how to apply different time charts, etc, I don't use stop-losses anymore because I KNOW what I'm doing!
The best stop loss is mental stop lose but for stop loss is dangerous coz the market maker algorithmic trader will definitely kick your trade and take your money. One way the stop loss is good when you takes monster positions 😉
This is true because usd/jpy was on a big down trend and I decided to go short with a tight stop loss and by the time I woke up I was stopped out of a 1000 dollar profit so this information is very accurate
Do hedging on both ends, no need to apply stop loss. Sell one leg in profit, wait for market to move opposite and earn some profit from the other loss making leg.
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I have been trading for more than 15 years. I can guarantee you that the single greatest error that a trader can do is to ignore the risk he is willing to take. Risk management necessitates the use of stop loss orders, either inserted into the platform or mental, it is the same. Ignoring risk leads to catastrophic losses. It is not related to 'if' but only to 'when'. It is simply a matter of time when exactly you will be blown out. If you are constantly stopped out, then it is absolutely certain that you are doing something wrong with your risk management. It's not your stop loss orders that are wrong and need to be omitted, it is your whole strategy that requires amendment.
Many words of wisdom.
I blew up a few accounts when I started out by trying not to lose.
Became profitable once I realised and accepted that I needed to learn to lose before I could win.
Sounds nonsensical, I know but it is a fact.
Another gem was learning that successful trading was not about being right.........It's about doing the right thing by sticking with your trade plan and your strategy. You will have losses and you have to accept them.
If you’re a Scalper you can’t afford not to use a tight stop loss.
If you’re a Swing trader, this may work for you. I think it depends on what kind of trader you are.
Stop losses are advertisements for the institutions. You're showing them where liquidity is and they will move price to snatch you up. Chances are you're putting the stops where most traders put theirs and when the big boys see batches of liquidity above or below support/resistance, it's a perfect opportunity for them to do their business efficiently.
The best way to protect your trades is by keeping a low lot size. So when it goes against you, like way against you, you can still weather the long storm and wait for it to come back. It isn't about stop losses, it's more about lot sizes.
Agree with this 100% Too many times got taken out with a stop loss, only for the market to go back in the trade's favour.
2:50 “I go all the way in” then the look from the lady
I was thinking the same XDD
I don't use stop losses at all!!! When I stopped using stop losses, I finally started making money.
If your in profit, place a stop-loss...
The day I removed the stop loss from my trading was the day a new world opened in front of my eyes.
VERY true, instead of placing an unrealistic tight stop loss, just reduce your share size and allow your trade room to swing back and forth. Your stop loss should always be based on previous support or resistance and those are not always in a tight range.
With 3 years of Live trading, he is totally correct
Best stop-loss is your interior hope 🙏indicator: as soon as you start hoping --> run, as fast as you possibly can. 🏃 💨
I have personally papertraded the exact same stocks at the exact same time on different platforms. I have found that it is true. It took me years to break this habbit because it was one of the first things I learned. You manage risk by your position size.
Stop losses should only be used when you are not actively watching your open trade, if you are at your computer or phone watching your trades then there is no need to have stop loss points.
Your stop loss protects your account from blowing up. If you have even a decent algorithm that you test over and over you shouldn’t hit your stop loss often at all, even while keeping your risk at or below 2% of your account. If you keep getting stopped out, the problem is your system, not your stop losses. If your stop losses truly are “too tight”, then your actual problem is money/risk management.
This man is telling the truth.
Tight stop losses is an idea that is designed mostly to benefit the brokerages/exchange/investment banks. Their objective is for you, the retail investor, to make as many and large trades as possible which makes them money every trade and also provides them the liquidity they need to turn your losses into their gains. They have a major conflict of interest when they encourage you to do certain things and tight stop losses is a perfect example of it.
No stop loss at all, small leverage and scale in at structure points.
I agree completely. Many trades I've done, I was always stopped out. The key for me was to have minimum capita with lower lot sizes and trade long term only.
I thought I was an irresponsible madman because I average down my stop losses and keep an eye on the chart doing that manually, finally someone that made me feel less alone at the battle field, thank you Mr.
I actually agree with him. One trade I was in I set the stop lose about a mile away because I was in fact confident in the direction it went negative about 21k but I knew it would turn and it profited 11k in the end👍🔥
ALL IN!!
NO STOP LOSSES!!
.....right. You can't go worse than that..
For scalpers tight stop loss is essential
Institutional traders will try to sweep out stops that are placed too close to the traffic, so you need more room to stay in the action.
no tight stop losses, let the price breathe
if u dont feel confident.. and if your gut says dont then DONT
This guy is super right. When I started trading newly I had reservations about putting stop losses since I monitored my trades a lot and then I decided to use stop loss suddenly I lost more using stop losses more often than necessary and most times the trade eventually went in the direction of my prediction
The week I stopped using stop losses but instead monitored my trades and closed them manually when the prices reach where my stop loss would have been, I made 30% on same strategy that was making 2%.
This doesn't make sense. If you manually closed when it hit the stop loss level, then you'd get the same result...
your stop loss positions are monitored by marketmakers
How? That doesn't make sense to me. According to you, your stop position either manual or automatic was in the same spot. Could you explain this please? All the best!
literally the exact same thing as using a stop loss.... so, insted of setting your stop loss, you mentally set it then adhered to it. exactly the same strategy. this is some misinfo right here. someones trying to set up the public to feed their own strategy.
Chiny O yes because they can see your stop loss order
Wow, now I feel comfort knowing that I'm not alone. Believe this guy. Your eyes should be the manual stop loss.
Absolutely right. Day traders blow up their accounts only due to the tight stop losses even though they may have got the direction right. Its frustrating.
How to use stop loss- depends on your trading set up and analysis:
How far would the market have to move against your intended entry area for you to decide you were wrong? Your stop loss should be outside that zone. If the distance huge, you need to wait for a set up where your stop loss distance is smaller.
Some people use too tight stop losses, but you should always have a stop loss of no more than you are willing to lose in one trade, or in one day. To go without using any stop loss is asking for disaster.
Coming from an individual who's not a profitable trader sounding as if he's a pro, I can't accept that. Mostly 90% of Trader's aren't profitable and you've just stated what 90% of traders do, so your comment holds no verifiable merit.
Mlogan11
Yes, I think he’s specifically talking about equities, ETF’s, generally slower moving than FOREX. Most people getting into trading seem to be drawn to FOREX, and certainly when new to trading you need tighter stop losses, even just to give yourself a chance of not wiping out your account early on.
In terms of size of stop loss, he’s not taking about not having a stop loss. He has one but it’s not tight. So within a day he will override and close the trade manually before the stop loss is within range anyway - if he feels he got it wrong in the first place.
He’s obviously medium range trader as mentioned. And presumably confident, competent and used to getting the call right a lot of the time.
I do know of people who are well against quick return and much more about long term wealth growth.
Bottom line. Until you’ve got a bit of time and successful trading under your belt, you have to protect yourself with reasonably tight stop loss.
Or more to the point, trade virtual until you’re more than confident you’ve progressed to a point where you’re are consistent enough in your successful trades.
Once there is consistency to you should be able to work out what risk tolerance suits your trading style/method. The instrument and time frame your trading also being major considerations.
When I was first learning about stop losses.. that's the first concern came to my mind.. what if there's just flash pulls/pumps for split seconds?
What this guys saying is ABSOLUTELY right. DO NOT use stop losses. Always keep an eye on the market. Do not sleep with your open position (w/ high margin/leverage ofc)
Too tight stop loss is bad, too wide stop loss is bad too. To find the optimal stop loss, one needs to backtest the strategy or find out the hard way by trial and error.
Pure crap unless you are a long term buy and hold person. "I am not a very good risk manager," nuff said sir.
Not putting a stop in the market is different from not having a stop in mind. Not using a tight stop is different from not using a stop at all. If you know the reason you put a trade on, you know when that reason no longer exists or has failed. If you know your support and resistance and trend patterns and what you're trading within and you're not overextended, you can choose to take a fast loss or gamble on a bounce.
He is absolutely right...I learned it the hard way, now I keep a large SL, now my winning average is much much better
And your risk / reward ratio .... .. . ?
Also the problem is that people are not precise with their entries, you need to enter in a very tight precise entry signal in a SHORT TIME FRAME, that goes in the direction of your long time frame if you are looking into a longer time frame trade. That way you can put your stop really tight and are not just entering in the middle of nowhere because you have no idea whats happening in the smaller time frame, remember everyone talks about lagging indicators well looking at a 1 hour 3 hour daily chart is a lagging indicator by definition, go into the smaller time frame and do the same thing you are doing in the larger time frame, find a entry signal where you can put a tight stop and is going in your direction so now your risk to reward ratio is huge and your risk is very small! then as soon as you can move the stop to breakeven, now you have a ZERO RISK TRADE!! its not risk management its about RISK ELIMINATION! you don't want to manage the rats in your house you want to eliminate them, first minimize the risk, then you eliminate it for ever , now your trade has zero risk.
Do the fundamentals analysis, decide which way the market is going. Then build a position. If your in the red but your conviction is that the market is going to come good then add to your position. Keep your position sizes small and manageable and have a cut off point where you kill the trade but give your stop loss plenty of room. Key thing here is to build your position rather than just going in heavy right from the start.
Don't go heavy and don't build nothing. Just open another position in something that's hopefully not correlated.
A sincere advice to you guys who are watching this, use a stop loss at every trade! If your stop loss get taken out alot, you will need to relearn where to entry at a better price and avoid putting SL at obvious support and resistance area, you will thank me in the future.
Say no stop losses, is essentially saying don't get out of a trade until it works. That's a recipe for disaster and blowing accounts.
Take the loss and live to trade another day.
If you stop losses are stopping you from making money, than it's not the stop loss it's the trade.
At first I thought it means, never to use stop loss in all cases. I appreciate that he mentioned not to use too tight stop loss and that if you are confident that you’re trading in the right direction, dont use it. If youre not confident, dont do that trade at all.
After being stopped out TOO many times, I finally stopped using them and instead I put AUTO ALERTS on my positions instead, so only I know where my stops were instead of the Market Makers knowing and letting them manipulate the prices down. Now, when a price goes against me I am alerted by my platform so I can look at it to see if the Volume to Price (VPA) is indicative of market manipulation or just recent news that is causing a dip.
He's right - a tight stop loss will take you out too soon and you will lose $$. Best to set a stop loss of 20-25% against the former high, adjusted against the ATR (average trading range), and in this way you let your winners run and your exit - if triggered by the stop loss - won't be at the high but you will make $$ on your exit. Your entry needs to be into an upward trend.
After getting stopped out over n over by large whales ! I’m done. I keep huge low stop losses if ever ! Confidence in investment is key. Namaste
This makes perfect sense. Upon looking back at my trades, most of the times they go in my direction either shortly or a little after getting stopped out.
Absolutely, my broker always try to convince me to put stop loss but I never do. I make 85% of winning trades.
best choice!!
for example, I had bought at a certain price. Then it crashed down a lot but I held and now it is back at my price again with an uptrend. Mental stop loss is best!
I would recommend a trailing stop once your already in a profit
Wow! I totally agree! I started losing money only because of stop losses. Now I just watched a video that makes sense. Set stop losses when in profit! You lose before you start winning and where that drops before the win is unpredictable.
Without Stop loss most of the traders will blow their account, which most of the newbies do.but with Stop loss you stay longer in the game and hopefully learn.
Stop loss should be at the place where if prices go it changes the anticipated structure of the market, where the price should not be if you were right.
my stop loss used to get triggered by the market maker spiking the price in one direction or the other. once this happens to you a couple of times, you realize the stop loss may not be your friend.
I find this to be very true.
Most times once your stop loss gets hit, price usually reverses to your intended direction.
This happens more than 90 percent of the times when I use tight stop losses.
I use stops always.. the msg here is simple, place any stops outside the normal volatility range relative to the time frame in which your trading. I'm always wary of people like this encouraging inexperienced traders not to place stops rather than teaching them where to place their stops.
he's right, the market makers have way more data than you do as a retail trader and they can see your entry points.. like level 2 data in stocks. they will push the market against you. stay liquid and be able to rid out "static" higher timeframes are best. long term positions, bankers aren't watching the market like retail traders do, they're working, its a job to them and its long term weekly to monthly and even yearly targets
Depends the time frame you're trading at. If you're trading the 60 min, 2 hours you should know if the trade did what you wanted it to do. If it didn't, get out - take the hit.
I only had problems with hard stop losses before I fully understood price action and my strategy. IMO problems with stop losses have more to do with not fully understanding price action and the pulse of the market. Every trader is different so if stop losses don't work for you then don't use them and vice versa. I know plenty of people who have blown out accounts from not having a stop loss, confident a trade would "eventually" go in their favor and couldn't determine when to cut the loss. The size of the account didn't make a difference. They suffered from lack of experience and/or ego. There is no one size fits all solution. Learn yourself and what works best for you and you will find maximum success in the market.
Tight stops mean you are gambling and there's no background check behind the trade. This guy is right. My stops are always much lower than my target.
Using a stop loss is like playing poker and showing everyone at the table your hand....never use a stop loss...it is the way wall street professionals pick your pocket !!!!
Nobody really knows it's your stop loss and to what opening price it belongs to
There’s much risk involved, most traders are searching for that elusive method where they never lose or can win eight or nine trades out of 10, amassing huge profits in a short amount of time with no risk.
Totally agree about stop losses. From my point of view the thing consists in risk management, if the size of your position, the size of your lot is compatible with your account balance. Period.
Im a day trader, guess what? I use super tight stop losses and i didn't get stopped out that much, by making sure that the market condition is not entirely chaotic and find a good entry, it take patient to do so but the return is worth it.
if you have an edge that requires a predetermined loss per trade, stopping out at defined levels is necessary to allow for the positive expectancy to materialize
Stop loss orders can be your biggest enemy or your biggest ally. If you don't where to put them and how to magage them, you are going to be manipulated by the large traders. If you put them in the right places, you will be able to trade WITH the large traders.
I never used fixed stop loses. Like the man said you know when to close. It’s just a instinct you build after long period of trading.
One wrong prediction , you blow your account. Stop loss are important Sir.
When he said he’s not a good risk manager, that said a lot more than everything else he said. He’s got a good point though.
Well, at the same time, many novice traders lose money because they have faith that the market will go in the direction they have predicted, when markets go against them. Truth is, novice traders have to know where they should exit the markets, this is extremely important, using stop loss or not.
Watch this and do the opposite. Wtf... Brave? No Stoploss? All in? Unbelievable for a trader to give such an advice.
Stop loss Kills! Trade your way and manage your trade.
If you backtest your system you should know where to put your stop losses
the best free advised in forex
He's correct tight stops is a bad thing because most times you're right and then get stop out because youre listening to people saying control risk
I notice this in crypto constantly. Price will start to move in an obvious uptrend, get knocked down 2-3%, stop out all the tight wads who actually picked a good spot, and then go nuts from there.
I NEVER use stop losses and profitable daily. I only focus on 2 charts and got a good feel for them.
Stop losses are a scam. NEVER USE THEM. Market will go lower just to trigger your stop loss to take you out and then go back up. Instead, simply set alerts and then act manually when the time comes.
he was right dow jones broke 19 and went to 20
Exactly correct. He is bold enough to say the reality about stop loss. I thank Andre Minassian for his explanation. I appreciate the beautiful anchor also (sorry, I dont know the name) in this video. Keep uploading such videos for helping the traders, who get losses due to stop losses.
He's right about tight stop losses losing traders money. Securities and Forex are always whipping up and down - especially Forex. Traders using tight stops will almost always just end up losing money.
Better to avoid buying the underlying altogether and just sell Options on them.
I'm on board with this. I have never used stop losses. I swing trade blue chips. If I used stops I'd be flat broke.
Fact...i lose more when i put tight stop loss, not giving enough room for stop will put you out in the game. put your trade when the price is going to pullback with a stop that will hit the support.
Believe me, trading with out stops is like going to a war with out a shield. you may kill 100s, but surely one bow will kill you. you are trading not to kill your account, but to make money.
stop loss is the biggest scam in this industry, here is an entity that knows that x many people will win and ask her for the prize and know also that these would be winners have a hidden secret (the stop loss) if used against them they will give up on the prize, what do you think this entity will do in your right
mind?
Pretty simple really. I usually have a 2% stop loss in trades that I'm confident on. They nearly always never get there before going back up. The ones that do keep going, usually a stock dump
Totally. I don't trade Forex but I don't use stop losses. i do follow stuff very closely.
Even if you have a tight stop loss, and it gets hit, you can always get back in the trade at a later time, which may be better for you anyway. With a real large stop loss your risking way too much.
etaylor38 Exactly. They are tagged on upthrusts, downthrusts and then the market reverses to your direction. There is no way to control or predict them, watch out for market openings, news releases that’s when they like to do them. And then re-enter to your direction on a spike.
but then your taking losses which 1. affect the mind and 2. affect the balance. if you put in a stop and get stopped out are you really going to be as confident adding another position on that trade? i don't think so. Yet better risk less, use no stops and massage an area with 3/4 positions equally overall the % your willing to lose then manually watch over the trade. The only thing i use when trading is TP levels in case am not at the charts and it hits the TP level i was aiming for.
The point is you're losing money every time your stop loss is hit...
when i removed my stop loss, i keep winning already
I've never profited from trading, so take my opinion with a grain of salt:
It's all about context. It's obvious from the video description and the video itself that this guy is a medium-term trader. This is where his observation comes from, and he's absolutely right. BUT, if you're a day trader, you want a tight stop loss due to the volatility and presumed limited market exposure in your strategy. With consistency, your tight stop loss will pay off.
While setting stop losses in the noise (ie too tight) is a terrible idea, setting stop losses with proper consideration of market volatility is the only way to consistently make money in the market. Going all in will eventually kill your profitability with a few bad trades.
That's the truth; intuition has a lot to do, the maket owners know your stop losses so they can take you out.. You have to be sure about what you trade or not
The best statement I have seen on this subject is to put the stop loss at a place where you know for sure the trade is not working as you expected (max 2% risk of account equity). And definitely NOT 'just below support' or 'just above resistance', as that is where everyone in the FX industry is brainwashed to put them and that is where the big money is looking to take out your trade for their benefit.
A Stop Loss will not protect you in case of a gap down then, you lose your shirt even with a Stop Loss. Buy a Put Option which gives you better protection with leverage to boot!
Stop-losses is for traders who simply don't know what they're doing and, unfortunately, most traders don't know what they're doing. And if YOU don't know what you're doing it is better to use Stop-Losses. Even those self-appointed Gurus on RUclips don't know what they're doing. Since I've learned about Patterns, The Elliot Wave Theory, the difference between an Impulse Wave, Motive Wave, ABC Correction, Prechter, Ending Diagonals, Wedges, Triangles, Gann Theory, Pivot Tables, Moving Averages, how to apply different time charts, etc, I don't use stop-losses anymore because I KNOW what I'm doing!
and.. Be sure to network with friends of similar interests in trading, there's nothing worse than feeling isolated when you make investment decisions.
The best stop loss is mental stop lose but for stop loss is dangerous coz the market maker algorithmic trader will definitely kick your trade and take your money. One way the stop loss is good when you takes monster positions 😉
I agree with him, and the Point is : We Have To Manage Our Equity To Trade With Rational Volumes ...
I agree , high leverage and tight stop loss means easy money for those institutions.
Congratulations if you can trade like that show your profits as well 😜
I like this guy. He is just so transparent
don't have tight stop loss but do have stop losses
This is true because usd/jpy was on a big down trend and I decided to go short with a tight stop loss and by the time I woke up I was stopped out of a 1000 dollar profit so this information is very accurate
By the look of these comments.. I've learnt that everybody does things differently.
Do hedging on both ends, no need to apply stop loss. Sell one leg in profit, wait for market to move opposite and earn some profit from the other loss making leg.