Have you ever fallen in love with a trade?

FTC Community TeamStaff17 Sept 202617 views

The trade with the perfect story, the one you'd defend to anyone, the one that can't be wrong because the reasoning was so good. Love for a trade is the most expensive emotion in the market.

Have you ever fallen in love with a trade? — risk-reward diagram — A risk-reward ratio of 1 to 2

Tell the story:

the trade you loved and why
how the love changed your management
how it ended, and what you learned

Have you ever fallen in love with a trade? — candlestick anatomy diagram — The parts of a candlestick: wick, body, open and close

The stop-loss guide exists to end these relationships on schedule.

Background: Where to place a stop-loss: structure, volatility and time stops

A stop-loss belongs where your trade idea is proven wrong, not at a round number of pips. Here are the main methods and the mistakes that trigger stops early.

How far away should a stop-loss be?

Far enough that normal price movement doesn't reach it, at the point where the reason for the trade would be proven wrong. The position size should then be set so that distance costs a fixed share of the account.

Why was my stop-loss hit when the chart didn't reach it?

Charts usually show the bid price, but sell positions are closed at the ask. When the spread widens, the ask can reach a sell stop while the bid line on the chart stays below it.

Read the full guide

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