Using Stops = More Profits in the Long Term (and some short ideas about stops)
This will be short but I think I just need a reminder and confirmation to myself that trading with stops would have made me a more profitable trader of the longer run and is what is keeping me a profitable trader right now. Some of my biggest losses came from me not getting out with a smaller loss when I had a perfectly good opportunity to take a loss that wasn't very big far after my original idea had broken down and move on. A stop loss would have kept me from getting in this situation in the first place. A stop loss also prevents breaking news from totally messing you over (which I've had happen). While some of these out of no where occurrences don't happen very often they can be bad enough to knock out a week or months earnings - IF you don't have a stop in. How do I know where to put my stop...well it depends. A percentage of an ATR works sometimes. sometimes it is a level that I am trading off of like where a lot of volume has been traded or a key resistance or support level which could be high of day or low of day. It honestly depends, but I think those are some pretty good ideas. It also had to depend on how much you are risking and willing to give up. Anyway the point is stops help. They are a good practice! Have a great day or night wherever you are! Cheers!
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