In trading, every decision made it’s always has its pros and cons. Alright? So, there is no single decision that is absolute best. Alright? Even when I share with you about you setting your stop loss too close, that is also based on my personal experience. Alright?
So, and of course you have to think about whether what I say makes sense to you or not. So, even while you widen your stop loss, that doesn’t mean that you should widen a lot or too much. Okay?
Bottom line is this: ask yourself based on your strategy, based on your entry, where is the next support compare to your entry, and then try to put your stop loss certain distance away below that support. Okay? The rationale is this: if that support level … the price, let’s say it pulls back to that support level, okay? By right it should actually find support and bounced off again.
If it doesn’t stay at the support, and it breaks below that support level, it means that probably it is actually turning down from here. So, that is the reason why you take a stop loss when it breaks down that support level. Alright?
It’s not to say that you should widen your stop loss as much as possible, but look at the technical chart to decide your stop loss. Okay? And if you do it this way over the long, large number of trades, this method should actually serve you well over the long run.
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